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Business News/ Market / Stock-market-news/  Market roundup | Funding surge for Indian Internet firms
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Market roundup | Funding surge for Indian Internet firms

In other news, widespread shutdown of malls affects supply; oil up after data, dollar gains as Brexit materializes

The Flipkart funding, which accounts for a large chunk of the total, hasn’t been officially announced by the company yet. Photo: Hemant Mishra/MintPremium
The Flipkart funding, which accounts for a large chunk of the total, hasn’t been officially announced by the company yet. Photo: Hemant Mishra/Mint

Unlisted Indian Internet firms raised a total of $2 billion of private funding in the March quarter, estimate analysts at Jefferies India Pvt. Ltd. This marks a reversal from the weak inflows in calendar year 2016 wherein internet firms had raised $2.7 billion in all.

But this was largely because some companies settled for down rounds, where funds are raised at a lower valuation vis-à-vis the previous funding round. “Media reports suggest both $1 billion raised by Flipkart and $330 million by Ola (accounted for 65% of the total funds raised during the quarter) have happened at lower valuations vs. previous round", said the report. To be sure, the Flipkart funding, which accounts for a large chunk of the total, hasn’t been officially announced by the company yet.

Widespread shutdown of malls affects supply

A note by Jones Lang LaSalle (JLL) India says that the net supply of retail malls was in the negative band during 2016—the first time in India’s history of retailing. This is because the rate of malls that were withdrawn was high as they ran out of customer preference. While the shutting down of malls is not unusual, it happened at an unusually high pace in 2016.

Five malls were shut down and 10 were changed for other purposes such as offices, hospitals, etc. resulting in 3.5 million sq. ft being withdrawn from the system. That said, 2017 shows more promise with greater investments into new retail malls and also higher private equity interest in the same. Further, the pre-commitment of occupants ranges from 51-75% for good malls but 0-50% for not-so-good malls.

Oil up after data, dollar gains as Brexit materializes

Crude futures hit a week high after a smaller-than-expected build in US inventories. Also, gains in the energy sector, up more than 1%, kept the S&P 500 afloat, while none of the other 10 sectors moved more than 0.5% up or down.

The dollar index gained 0.37% with the euro down 0.55% to $1.0752. Sterling hit a one-week low of 1.2378 earlier, and was last trading at $1.2407, down 0.33%. The euro slipped after Reuters reported European Central Bank policymakers are wary of making any new change to their policy message in April. Weighing on the euro and pound, Prime Minister Theresa May formally began Britain’s divorce from the European Union, a decision pitching her country into the unknown. Reuters

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Published: 30 Mar 2017, 03:01 AM IST
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