Owned by Walmart, India’s e-commerce giant Flipkart has raised it’s IPO valuation target to USD60 to 70 billion, and plans a US listing in 2023 said sources familiar with the matter.
Flipkart had earlier set an IPO valuation target of USD50 million. Flipkart is a direct competitor with Amazon.com in India’s burgeoning e-commerce sector.
Flipkart is said to have plans of focusing on it’s two new business areas which are online healthcare services and travel bookings, in an effort to further boost valuations before the IPO.
Earlier, Flipkart had scheduled its IPO for 2022, but with the onset of the Ukraine war and ensuing global turmoil, has decided on a US listing in 2023.
Last year, Flipkart acquired Indian travel booking website Cleartrip, and has recently launched a Health+ app to offer medicines as well as other healthcare products and services through its platform.
A source said that the travel business owned by Flipkart has shown great promise. As a result, the company felt that there was a bigger advantage to valuation than they had earlier felt.
While one source pegged the intended valuation at USD70 billion, another source said that it could be between USD60 to USD65 billion.
Walmart confirms that IPO is part of the plan
Chief Financial Officer of Walmart, Brett Bigs, mentioned at a conference that Flipkart’s business was performing as expected, and that an IPO was very much a part of their plans. The CFO declined to specify the proposed timeline for the listing.
According to unconfirmed sources, the listing is likely to take place in the first half of 2023. Incorporated in Singapore, Flipkart intends to list in the US market.
Planning for the IPO has come at a tumultuous time, as traditional retailers allege that Flipkart bypasses federal regulations and favors select sellers. The company denied these allegations. India is reported to be working on a host of e-commerce regulations that could make foreign companies wary of entering the space.
In 2018, Walmart acquired Flipkart for USD16 billion in return for 77 percent stake in the company. At that time, Walmart had said that it planned to take the company public in four years.
Last year, Flipkart raised USD3.6 billion in funding, giving it a valuation of USD37.6 billion.
The funds raised bolstered the financial position of the That fund raising helped bolster the company’s financial position, providing it with enough cash for expansion, negating the need for an IPO at this stage, added one of the sources.
The IPO market in India had boomed prior to the Ukraine invasion, and enthusiastic retail investors pushed prices to record highs, which encouraged a range of Indian companies to go public.
More than 60 companies made their market debut in India in 2021 and raised a total of more than USD13.7 billion, which was more than the previous three years combined.