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Walmart has purchased Tiger Global’s remaining shares in Indian e-commerce startup Flipkart for $1.4 billion. This move further expands the retail giant’s stake in Flipkart, marking a significant milestone in its investment in the Indian market. The transaction took place recently, and Tiger Global reported a gain of $3.5 billion on an investment of $1.2 billion.
Tiger Global’s Investment in Flipkart
Tiger Global, a New York-based hedge fund, was one of the earliest investors in Flipkart. The firm had invested more than $1 billion in Flipkart, making it the only Indian startup to receive such a substantial investment from Tiger Global. The firm’s investment in Flipkart played a crucial role in boosting the Indian startup community and putting India’s ecosystem on the global map.
Flipkart’s Valuation and Walmart’s Stake
The secondary Flipkart shares sale valued the Bengaluru-based company at $35 billion. Flipkart was valued at $37.6 billion in a funding round in 2021, but it has since internally cut its worth by about $5 billion following the split of payments startup PhonePe.
Walmart, which paid $16 billion for a 77% stake in Flipkart in 2018, held a 72% share in the firm as of last year. Prior to the recent transaction, Tiger Global held a 4% stake in Flipkart.
Future Prospects and Funding Needs
Despite the substantial investment, Walmart remains confident in Flipkart’s future and the opportunities in the Indian market. However, Flipkart has largely depleted the capital it raised in 2021 and now faces the need for another round of funding. While the company has gauged market interest in recent months, no deal was struck due to a lower valuation. As such, it seems likely that Flipkart will turn back to Walmart to secure the majority of the financing needed for the next round.
Walmart’s acquisition of Tiger Global’s remaining stake in Flipkart underscores the retail giant’s commitment to expanding its presence in the Indian e-commerce market. As the company continues to invest in Flipkart, it is poised to play a significant role in shaping the future of e-commerce in India.
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