A source familiar with India’s top eCommerce company Flipkart told Reuters that the firm is hoping to raise as much as $1 billion in its latest funding round.
While the source did not confirm any potential investors and the exact valuation, they did say that Flipkart hopes the number reaches the “double digits,” meaning a valuation of $10 billion or more.
A Flipkart spokesman declined to provide a comment on the market speculation.
But according to Reuters, The Financial Express newspaper reported that the expected funding round could result in Flipkart reaching a valuation of up to $8 billion, significantly lower than a $15 billion valuation seen in 2015.
One of Flipkart’s biggest competitors, India’s eCommerce company Snapdeal, shared that it is “restructuring” by laying off employees. The number of layoffs is said to be between 500 and 600 people.
The main problem for Snapdeal is that its competitors in the eCommerce space are significantly outpacing the company when it comes to investments. While Flipkart recently raised $1.5 billion and Amazon has invested $3 billion in expanding into the Indian market, Snapdeal has raised only $1.6 billion overall to date.
With the rise of smartphones and improved standards of living in India, internet penetration is also on the rise. As such, India has become a hotspot for eCommerce companies to invest and expand. To keep pace with eCommerce giants like Amazon, Alibaba and Flipkart, Snapdeal may need a more aggressive growth strategy.