Flipkart emerged as India's top e-commerce company when it did not face any significant competition in the Indian market. The rules of the game changed last year when global e-commerce giant Amazon came out in the market to compete with Flipkart and other e-commerce companies.
Last year, Flipkart moved its back end technology operations to Singapore. Flipkart Pvt Ltd, the key holding arm of Flipkart, is a Singapore incorporated entity.
Yesterday, Flipkart announced that it has raised a capital of US$1 billion (S$1.24 billion) from a group of investors, including the Singapore government's sovereign fund, GIC. Temasek, which is the other sovereign fund of Singapore, also recently backed Snapdeal, Flipkart's domestic arch rival.
The other partners who have contributed to this round of investment are (existing investors) Accel Partners, DST Global, Iconiq Capital, Morgan Stanley Investment Management, Naspers and Sofina.
The investment amount raised is one of the largest for any e-commerce company globally. Also, it is the single largest amount raised for an Internet company from India.
Flipkart sources said that the company will use the new funds to make long-term strategic investments in mobile technology in India.
Flipkart offers over 15 million products across 70 categories including books, media, and consumer electronics.
"We have close to 22 million registered users today," said Flipkart co-founders Sachin Bansal and Binny Bansal (they are not related to each other). "We handle 5 million shipments a month. These numbers were unheard of a few years back and we are excited about the scale we have managed to achieve. But what is even more exciting is the huge opportunity that we still see before us."
"By 2020 India will have more than half a billion mobile internet users. Our intense focus on mobile and technology puts us in a unique position to take advantage of this massive opportunity," the co-founders said.
This new funding will enable us to step up our investments for innovations in products and technologies, setting us up to become the mobile e-commerce company of the future. This funding will help us further accelerate momentum and build our presence to become a technology powerhouse," they said.
With this new round of funding, Flipkart has raised around US$1.75 billion to date.
Only two months ago, the e-commerce player received a US$210 million investment led by DST Global, a global investment firm, with funds from existing investors Tiger Global, Naspers and Iconiq Capital. Last year Flipkart had raised $360 million from various venture funds.
Though the company is not profitable yet, it is on course to surpass its target of US$1 billion in gross merchandise value for the current financial year. In May, Flipkart acquired Myntra Designs Pvt Ltd, which runs the online fashion and apparel shop Myntra.com.
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