Google invests $350 million in India’s Flipkart

Google is to buy a $350 million (£275 million) minority stake in Indian e-commerce company Flipkart, which is majority-owned by Walmart, and will also provide cloud services to the company, Flipkart said.

The investment is part of a $1 billion financing round that began in 2023 and is led by Walmart, which invested $600 million late last year.

According to reported estimates that have not been confirmed by the company, the round values ​​Flipkart at around $37 billion.

“Google’s proposed investment and cloud collaboration will help Flipkart expand its business and accelerate the modernization of its digital infrastructure to serve customers across the country,” Flikpart said in a statement.

Microsoft is also a minority investor in Flipkart, which competes with Amazon in India.

Development of e-commerce

According to Bernstein analysts, Flipkart controls about 48 percent of India’s e-commerce market, alongside other competitors including Reliance Retail and SoftBank-backed Meesho.

Bernstein said India’s e-commerce market will be worth about $133 billion next year.

“Amazon and Flipkart remain leaders, driven by category strengths in mobile, consumer electronics and home appliances,” the analyst firm said in a recent note.

“However, unlike the big horizontal winners in the global e-commerce market, India is likely to see category winners emerge as we scale up, such as Blinkit (fast trading), Meesho (Tier 2 or above marketplaces) and Nykaa (vertical trading ).

Walmart acquired Flipkart as its majority investor in a $16 billion deal in May 2018.

Investment in India

Google in 2020 revealed plans to invest $10 billion in Indian companies and has since made significant investments in telecom operators Jio Platforms and Airtel.

The Android maker announced last year that it would start producing Pixel 8 smartphones in India.

While announcing the plans, Google stated that “India is a priority market for Pixel smartphones.”

More recent reports indicate that the company has struck a deal with Taiwanese contract manufacturer Foxconn to produce the phones in the southern Indian state of Tamil Nadu.