One97 Communications plans to earmark nearly $1 billion to expand its payments business into high growth areas like lending and insurance.
In March, Flipkart recorded an average of 5 lakh shipments every day, while Amazon closed in with about 4.5 lakh daily shipments.
After pouring over billions since 2014, Alibaba's early investor Son has not been able to pick winners in either online retail, payments or grocery retail. His firm is now looking to make up for missed opportunities through a string of consolidation plays.
As Japanese telecom and internet major looks to sell Snapdeal and Freecharge owner Jasper Infotech, it is eyeing a significant stake in market leaders.
Naspers, which has backed companies like Flipkart and owns about a third of travel portal MakeMyTrip, is expected to invest $50-60 million as a part of the funding round.
Entrepreneurs and investors bedeviled by growth pangs and lack of sufficient capital in recent months have good reason to be circumspect.
Its plans to turn profitable in specific categories comes at a time when it faces Amazon’s $5-bn war chest in India, as well as looming threat of Alibaba’s entry.
"We have focused a lot, in the past 12-15 months, on improving costs and margins, reducing burn rate, and improving working capital," Binny Bansal said.
The $1.4-bn deal is led by Tencent with an investment of $700 mn while eBay will contribute $500 mn & also receive Flipkart stock worth $200 mn in lieu of its Indian operations.
The cumulative FDI that companies like Google, Yahoo, Facebook and LinkedIn have put into India is less than $500 million.
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