When you think of e-commerce, Flipkart is sure to be at the top of your list. From groceries, books, gadgets, clothes, anything and everything is available on their website.
With that much outflow on an everyday basis, directors are bound to think about the company’s growth strategies. However, this time, it’s much bigger than an acquisition. Flipkart is planning to go public next year.
While the reports still await verification, news has it that Flipkart’s IPO (Initial Public Offering) is scheduled for the upcoming months. It’s one of the most common ways to generate capital. Nonetheless, ignoring the fact that such an upscale project requires a large sum of money, is criminal.
For that very purpose, Flipkart has approached a few of their most profitable investors to raise $3 billion. This approach will lend itself to various streams that Flipkart could gain from in the future. Growth and expansion are naturally on the cards when a business uses its capital wisely. They are looking at broadening their services to e-pharmacy and online food delivery too.
SoftBank is planning to invest $300-500 million to support Flipkart’s projects. Canada Pension Plan and Abu Dhabi Investment Authority along with the Japanese giant will invest around $2 billion.
Other companies such as GIC and QIA are also being targeted, but none of the firms are commenting on the news. Lots of speculation for such a big decision!
Collating all these pieces of information, what Flipkart wants to achieve in the nearing future, is a $35-40 billion valuation. The entire process has been slowed down due to the pandemic, but as soon as things start to get better, Flipkart should be ready to go public.
In the last few years, the Indian company was acquired by Walmart, an American retail giant for $16 billion. Flipkart since has raised $1.2 billion from its parent company while also buying stakes in others. The takeover has helped Flipkart maintain its position in the market. What was also gained, is a 20% stake that SoftBank sold to Walmart in 2018.
The pandemic this year has boosted online sales quite a bit. Amazon, Reliance, Flipkart, and other e-commerce companies have been competing aggressively to expand their market presence and sales.
While Flipkart is in its initial stage of listing in the United States, they are sure to go public worldwide sometime soon. This can go either way. But, from what is predicted, they are going to be standing at a stronger position, with bolder numbers, and overtake companies on their battlefield.