Flipkart has raised anywhere between $3 billion and $3.5 billion. to build a thriving long-term business environment, we need to get off the addiction of global funds buying market spaces in India like territory."ĭeorah predicts Flipkart’s valuation will eventually slump to the amount it has invested.
#MORGAN STANLEY WRITEDOWN PALANTIR SERIAL#
“Growing at negative operating margins to raise money in quick succession is a destructive style of doing business," said Kashyap Deorah, serial entrepreneur and author of The Golden Tap, a book on India’s hyper-funded start-up ecosystem. Over the course of 2015, Amazon gained market share in India at the expense of both Flipkart and Snapdeal, according to publicly available data and several company executives.įuture estimates by mutual funds of their holdings in Flipkart and Snapdeal-and these companies’ eventual IPOs-will depend a lot on these two factors. Two, whether they will lose out to the Indian unit of Inc., the world’s largest online retailer. One, whether they will ever be able to cut their ballooning losses without sacrificing sales growth. There are two broad concerns about the valuations of Flipkart and Snapdeal. “Our valuation has grown steadily between our last two funding rounds," a Snapdeal spokesperson said. The talks are at a very initial stage and the likelihood of a deal is a function of Flipkart’s willingness to offer a discount on its current valuation of $15 billion, Mint had reported then. Mint reported on 4 February that China’s Alibaba Group is in early talks to buy a stake in Flipkart and increase its holding in Snapdeal.
The $50 million fund-raising was also significantly smaller than what online retailers typically seek from investors. Snapdeal’s $50 million fund-raising, which was accompanied by $150 million in share sales by existing Snapdeal investors to new shareholders, took more than six months to close, primarily because there are not too many takers for India’s top e-commerce firms at their current valuations. BlackRock’s next filing on Snapdeal will be closely watched to see if other Indian unicorns will be marked down, too. Ltd), which raised roughly $50 million last month at a valuation of $6.5 billion. Rowe Price, Fidelity and BlackRock cut the worth of their holdings in US unicorns en masse.īlackRock is also an investor in online marketplace Snapdeal (Jasper Infotech Pvt. and data analytics company Palantir Technologies Inc. Flipkart declined to comment for this story.įlipkart is hardly the only unicorn, a term that is used to describe start-ups that are valued at more than $1 billion, to have its value marked down by mutual fund investors.Īlong with cutting the value of its stake in Flipkart, Morgan Stanley also reduced the worth of its holdings in file storage company Dropbox Inc. Given that Flipkart is expected to list its shares in the US at some point over the next few years, the valuation estimates of the mutual funds will be an important indicator of how stock market investors will value the company. Rowe Price hasn’t yet reported the latest estimated value of its stake in the company. Rowe Price and Baillie Gifford, are investors in Flipkart. The markdown is significant not only because it proves that Flipkart’s valuation had run ahead of itself, but also because mutual funds comprise one of the largest institutional buyers of shares in stock markets.Īt least two other mutual funds, T. Morgan Stanley’s latest estimate implies the mutual fund now values Flipkart at $11 billion.
Its valuation shot up roughly fivefold from $2.5-3 billion in May 2014. That was its fourth round of fund-raising in a year.
0 kommentar(er)
