Flipkart looks to list overseas by next year2 min read . Updated: 17 Sep 2020, 06:33 AM IST
Flipkart would look at an overseas listing, either in the US, where its parent Walmart Inc. is based, or another country
Flipkart may go public as early as next year at a valuation of $40-45 billion, a person familiar with the development said, as India’s largest online retailer benefits from accelerated adoption of digital platforms for shopping and payments by customers because of the coronavirus pandemic.
Flipkart would look at an overseas listing, either in the US, where its parent Walmart Inc. is based, or another country, the person said on condition of anonymity.
Walmart had in 2018 acquired a majority stake in Flipkart for $16 billion, valuing the Bengaluru-based company at $21 billion. At that time, Doug McMillion, president and CEO of Walmart, said that Flipkart will go public within four years of closing the deal.
“The IPO should be done at no less a valuation than that at which Walmart invested in the Indian e-commerce firm," Walmart had then said in a regulatory filing.
“As per Walmart’s timeline, the IPO could be done by 2022. But the digital transformation in India, with customers increasingly moving online to shop, has been so rapid, that it has made Flipkart grow much faster. Therefore the IPO plan could also be fast-tracked. Flipkart would get the best valuation if the IPO happens in the US," the person said on the condition of anonymity.
A Flipkart spokesperson did not comment.
Reuters first reported the news about Flipkart’s IPO plans on Wednesday evening.
In July, Walmart led a $1.2 billion investment in Flipkart Group, valuing the company at around $25 billion, in its largest fund-raising since its acquisition in 2018.
In India, Flipkart competes with Amazon and Reliance Industries, which has been ramping up its JioMart e-commerce business. Flipkart’s subsidiary, PhonePe, is also looking to turn profitable by 2022 and go public by 2023. Mint first reported on PhonePe’s IPO plans on 22 April.
The digital payments company, which competes with Paytm, Google Pay and Amazon Pay, is most likely to go public in the US at a valuation of $10 billion.
Recently, Flipkart, as a part of its funding announcement from Walmart, said PhonePe is currently processing annualized total payments value of $180 billion, and witnesses more than 500 million transactions each month on its platform. It looks to exit 2020 with more than 275 million users on its platform.
PhonePe has also set its sight on international markets and may look to take its payment solutions through Walmart to North America.
In the past few months, Flipkart has not only expanded its customer base and supply chain but also widened its reach to more PIN codes in smaller cities even as it introduced multiple languages on its platform.
“The focus of Flipkart, however, is growth right now, and the IPO timeline is not fixed yet. But the global guidance and Walmart’s acquisition was to always create the right processes and build the company to eventually take it public," said a second person.
In July, Flipkart acquired the Indian operations of Walmart as its parent sought to consolidate its retail operations