India: Flipkart valuation marked down by investors Valic, Fidelity, again

The Flipkart delivery process. Photo: Bloomberg

Even as it looks to raise $1 billion in fresh capital to compete with rival Amazon in India, Flipkart continues to face valuation markdowns by its mutual fund investors.

Two of its investors, Valic and Fidelity, who earlier marked up the value of their shares in the company, have again marked down their shares in Flipkart by 11.3%, and 3.2%, respectively, for the quarter ended August, according to a report in The Economic Times, which puts the firm’s valuation between $8.7 billion and $10.25 billion.

Before their markup, in May, Valic marked down the value by 29.4% as of February 2016 compared with August 2015. Fidelity marked down Flipkart’s value by as much as 39.6% for the same period.

Although Valic and Fidelity together hold a small amount of stock—worth less than $6 million— they are not the only investors to do so.

The latest is a part of series of markdowns that the company saw in the last year, which, when it last raised funds, was valued at $15 billion in July 2015.

In the April-June quarter, Morgan Stanley marked down the value of its shares by 4.1$% and T. Rowe Price marked down the value of its shares by 20%.

For the quarter ended March, US-based investment firm Vanguard Group marked down the value of Flipkart shares by 25%, from $136.87 as on 30 September 2015 to $106.65 as on 31 March 2016, according to regulatory filings with the US Securities and Exchange Commission (SEC). Morgan Stanley marked down its stake by 15.5%, in the same quarter.

Flipkart, though, has always maintained that these markdowns do not affect it. “The way we look at it is that when we raise money, that’s when we get a valuation,” chief executive officer Binny Bansal told Mint in an interview on 24 May about earlier markdowns.

Flipkart couldn’t immediately be reached for comment.

Also Read:

Flipkart in no rush to raise funds, raised enough in the past: CEO Binny Bansal

Why fundraising by Flipkart is an event in India’s startup space?

This article was first published on Livemint.com

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.