One of India’s e-commerce giants, Flipkart, is planning to come out with its IPO in 2023. It has raised its IPO valuation by around $60-70 Billion. It is looking to get listed in the United States instead of India. The company is backed by a well-known American Multinational corporation, Walmart.
The Flipkart Journey
Flipkart’s journey began in 2007 with an investment of ₹ 4 Lakh, started by Sachin Bansal and Binny Bansal together. The company did not start its operation as a full-fledged e-commerce site. Still, it began by selling books on its platform. It was easy to find vendors willing to expand their business instead of collaborating with electronics or fashion brands to increase their expenses. Soon, both the IIT Delhi graduates felt that it would be hard for them to continue their business without an out-reach of the internet. Both Sachin and Binny were adamant about making this work. Launched in Bangalore, the company was a hit amongst the customers, which led to their first Venture Capital investment of $ 1 Million from Accel. Later on, in 2013, World’s largest e-commerce site Amazon decided to play spoilsport and wanted to explore opportunities in India. More small-time players like Snapdeal, Myntra, and Jabong took away Flipkart’s business advantage by this time.
The Bansal duo did not fear Amazon and started acquiring companies like Myntra and the fashion e-commerce site Jabong to take on the American e-commerce site.
The Walmart acquisition
Walmart acquired Flipkart in 2018 for almost $16 Billion, and the company bought controlling stakes from firms like Tencent Holdings Ltd and Tiger Global Management. The company currently holds a 77% stake in the Indian start-up. Sachin stayed on as CEO for almost nine years ever since 2006 and later gave the charge to Binny Bansal, who remained as CEO up until 2018 he was pushed out from Flipkart. With this deal, Walmart gets access to a customer base of 300 million and offers over 150 million products in more than 80+ categories.
How is Flipkart doing under its new parent organization?
The company has been diversifying its portfolio. Its IPO was valued at $50 Billion, but now the company sees its valuation as around $60-$70 billion. Flipkart is expanding its business interest to different sectors by acquiring the travel booking website Cleartrip in 2021. The company announced that it received a 100% stake in the company to further enhance its digital commerce offerings. Also, in 2022, the company decided to sell Cleartrip’s Middle East Business to Wego to focus only on India. According to Senior Vice President Ravi Iyer, “The opportunity in travel tech for India is vast, and through Cleartrip, we have been able to provide our customers with a wide range of travel experiences and deeper value.”
“Given our strategic priorities and focus on the Indian market, the acquisition of Cleartrip’s Middle East business by Wego provides continuity to its business, and we believe that they are the right partners to boost its next phase of growth. We thank Stuart for his leadership and partnership over the past year as Cleartrip India has become an integral part of the Flipkart Group and wish him and the Wego team continued success.” Iyer added.
Besides Cleartrip, the company has recently forayed into a new online healthcare service business and launched a “Health+” app that offers its customers medicines and other healthcare products and services.
(Edited by Garvit Bhirani)