Online marketplace Snapdeal is likely to file papers soon with the Securities and Exchange Board of India (Sebi) for an initial public offering (IPO), The Economic Times reported.
Snapdeal is hoping to rase about 12.5 million rupees (about $165,000), although there will still be a public issue with another sale, according to the report.
The company was once a challenger to companies like Flipkart and Amazon India, and it might see an offloading from SoftBank, which made early bets on the company. SoftBank might sell some parts of its holding to get below 25%, the report stated. Snapdeal founders Kunal Bahl and Rohit Bansal are unlikely to sell shares.
The company could do well with a successful IPO after its initial failure to become the biggest eCommerce player in India, the report stated.
Lately, Snapdeal has been focused on selling unbranded products in a bid to cut down on its cash burn. Preparing to seek Sebi’s approval to go public, the company has been focusing on fashion and electronic accessories, according to the report. The company gets around 80% of its sales from 1,000 suppliers, although no supplier accounts for over 2% of the total sales.
In March, Snapdeal debuted an offering allowing small- to medium-sized businesses (SMBs) to get paid faster after an order is delivered.
The faster payments act as “a force multiplier,” according to a company representative.
The offering cuts down payment receipt time by around 76% and allows merchants to access funds. The funds could be used for letting them develop inventory, grow operations and handle other commerce needs.
Snapdeal bolstered its decentralized logistics network last year by adding new hubs in New Delhi, Bengaluru and Mumbai. The company also brought more than 5,000 manufacturer-sellers on its site.