The Indian online retail giant Snapdeal is preparing to go public through an IPO of as much as $250 million.
As Bloomberg News reported on Tuesday (Nov. 30), the company — which is backed by SoftBank and Alibaba — plans to go public in early 2022, according to people familiar with the matter.
Snapdeal, which competes in the same space as Amazon and Walmart’s Flipkart, plans to raise at least $200 million with a value of $1.5 billion, the sources said. The company did not comment on its plans.
Bloomberg notes that Snapdeal would become the largest tech firm to gauge investors’ willingness to back IPOs following the debut of Paytm’s parent company, One 97 Communications, which has lost around 20% of its share after going public on Nov. 18.
And as PYMNTS noted earlier this month, it’s not just Paytm that’s underperforming. Just under half of the companies that raised $1 billion for their IPOs this year are trading below their listing prices, including high-profile names such as the food delivery app Deliveroo and alternative food manufacturer Oatly.
According to Bloomberg, Snapdeal had initially considered raising around $400 million, aiming for a $2.5 billion valuation. Instead, it now hopes to follow in the footsteps of other eCommerce companies, such as the food delivery service Zomato Ltd. and beauty product company FSN E-Commerce Ventures Ltd., which owns Nykaa.
Sources told Bloomberg that Snapdeal’s largest shareholders — a list that includes eBay, BlackRock Inc. and Temasek Holdings — will not be selling shares.
Earlier this year, Snapdeal launched a product that lets small and medium-sized businesses (SMBs) obtain payment soon after an order is delivered. The company has said this product will shrink payment receipt time by up to 76%, letting merchants access funds to boost their inventory and expand their operations.
Since 2020, Snapdeal has welcomed more than 5,000 manufacturer-sellers to its site, mostly from centers such as Jaipur, Ludhiana and Meerut.