New Delhi: The online retailer giant Flipkart is now on its way to encore to its mammoth fundraising exercise of last year and is looking to raise $1.7 billion (Rs 10,500 crore) in the coming months.
"It (the fundraising) is being considered," said a person directly familiar with the plan to Economic Times, adding that the amount being talked about was in the "ballpark" of $1.7 billion.
According to the sources, the Bengaluru-based firm, which created a record in India's startup funding history last year by mopping up $1.9 billion in three rounds of fundraising, is looking at a valuation of around $15 billion in the latest funding round. It would be anchored by its biggest investor, US-based Tiger Global Management. Tiger could invest up to $700 million in several tranches.
A "handshake agreement" had been reached between Flipkart and the New York-based firm that had been sealed during the recent visit of its partner, Lee Fixel.
A senior company executive said that Flipkart was still to receive money from its last fundraising round of December last year, thereby suggesting that a fresh fundraising was not imminent.
Flipkart's last fundraising round in December had pegged its valuation at $11 billion. The company, which is still to make any profit, was valued at $1.9 billion at the start of 2014 but saw its valuations climb sharply as investors stumped up cash to grab a piece of the action in a market that rivals only China in its potential for growth.
Sources say that Tiger Global could be investing from its latest $2.5-billion (Rs 15,500 crore) fund that was raised in 2014.
The latest fund-raising exercise, when complete, will catapult Flipkart into the ranks of India's most pricey companies, with its valuation double that of other publicly-listed consumer companies, notably Godrej Consumer Products that has a market capitalisation of about Rs 40,000 crore and Dabur India with a market capitalisation of about Rs 47,000 crore.
The new capital will be used by Flipkart to bolster its position at the top of India's booming but fiercely competitive ecommerce sector that, according to an estimate by Nomura, is projected to be worth $43 billion by 2018.
Flipkart has aggressive rivals in the form of Amazon's India unit and Snapdeal, which counts eBay and Japan's SoftBank among its investors.
Jeff Bezos-led Amazon, the world's biggest online retailer, has made significant inroads in India, selling goods worth over $1 billion within a year of launching operations.
Last year, Bezos said Amazon will invest $2 billion in its Indian unit.
Snapdeal, the third contender in the race, received $627 million from Softbank last year and is on the road to raise more capital.
