NEW DELHI – SoftBank Group Corp. has demonstrated its interest in the Indian market by announcing investment in major e-commerce marketplace Flipkart Group.
Flipkart will raise an unspecified amount of capital from the SoftBank Vision Fund, the tech fund established by the telecom giant, calling it “the biggest ever private investment in an Indian technology company.”
“India is a land of vast opportunity. We want to support innovative companies that are clear winners in India because they are best positioned to leverage technology and help people lead better lives,” said SoftBank chief Masayoshi Son.
SoftBank has an India portfolio covering e-commerce, ride-sharing, digital payments, hospitality, clean energy and telecommunications, according to Flipkart’s fundraising deal statement.
“This is a monumental deal for Flipkart and India,” Flipkart co-founders Binny Bansal and Sachin Bansal said, adding that their company will continue to build their business to serve their customers.
The Flipkart Group is one of India’s largest e-commerce marketplaces and includes group companies such as online shopping mall Myntra, online fashion and lifestyle shop Jabong, payment app PhonePe and auction site eBay.in.
According to local research firm Venture Intelligence, which tracks private equity and venture capital investments, SoftBank Group invested around $1.41 billion in India in the first half of this year.
RedSeer Consulting has separately observed that India’s e-commerce sector faces multiple challenges in terms of regulation and slowing demand.
“Our research shows that industry size in January-March of 2017 just reached $14.7 billion, barely 5 percent higher than $14 billion a year earlier,” it says.