At least five mutual fund investors have marked down Flipkart’s valuation over the past year, including Fidelity Investments
A mutual fund managed my Morgan Stanley has once again slashed the valuation of India’s e-commerce leader Flipkart by 3 per cent.
According to filings with the US Securities and Exchange Commission (SEC), Morgan Stanley trimmed the value of its stock in the Bangalore-headquartered firm to US$50.51 as of December 2016 from US$52.13 apiece in September. This essentially means Flipkart valuation currently stands at US$5.39 billion. This is a steep fall from its peak valuation of US$15.2 billion as of June 2015.
This is the fifth consecutive markdown by Morgan Stanley over the past 12 months. At least five mutual fund investors have marked down Flipkart’s valuation over the past year, including Fidelity Investments which lowered it to US$5.56 billion in January this year.
According to Mint, the latest markdown will have no bearing on its current fundraising, as it plans to raise a massive US$1.5 billion from companies, including Tencent, eBay, Paypal and Microsoft, at a valuation of US$10-12 billion. As per another report, Flipkart is also in talks with US retail giant Wal-Mart for investment.
Started in 2007, Flipkart has been locked in a bitter battle with Amazon to become the numero uno in India. The e-commerce giant, once considered as the poster boy of the Indian startup ecosystem, has been in a shambles for the past couple of years. Flipkart, one of the first home-grown tech companies from India to enter the coveted global Unicorn startups club, has lost out to close rival Amazon, which came to India five years after the former’s launch in 2007. Flipkart enjoyed an invincible run until the entry of Amazon in 2012, and it has since been losing ground. The US-based company acquired signifiant marketshare and tens of thousands of consumers through a systematic marketing strategy and by offering better user experience and services.
Flipkart recently roped in Kalyan Krishnamurthy, Managing Director of Tiger Global Management, as its CEO. Under his leadership, the company has started showing signs of a turnaround.
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