Workers unload rice bags at a grocery store known as Kirana in Bengaluru, India on Monday June 21, 2021. D.

Dhiraj Singh | Bloomberg | Getty Images

India’s e-commerce giant Flipkart said Monday it had raised $ 3.6 billion in fresh funds from global investors including sovereign wealth funds, private equity and its parent company Walmart.

The new round of funding was led by the Singapore sovereign wealth fund GIC, the Canada Pension Plan Investment Board, SoftBank Vision Fund 2 and Walmart. It also included investments from sovereign wealth funds such as Qatar Investment Authority, Khazanah Nasional Berhad from Malaysia and DisruptAD, the venture arm of the Abu Dhabi sovereign wealth fund, ADQ.

Other donors included Tencent from China, Franklin Templeton and Tiger Global.

“This investment by leading global investors reflects the promise of digital commerce in India and their belief in Flipkart’s ability to maximize that potential for everyone involved,” said Kalyan Krishnamurthy, CEO of Flipkart, in a statement.

He said the company will focus on helping millions of Indian small and medium-sized businesses grow, including small family-owned grocery stores known as kiranas, and plans to continue investing in new categories and domestic technology.

SoftBank’s return

Japan-based SoftBank had previously sold its Flipkart stake to Walmart in 2018, and their return comes at a time when the Indian company is reportedly considering potential stock exchange options. Flipkart said it now has a valuation of $ 37.6 billion.

SoftBank has supported other Indian tech startups, such as digital payments company Paytm, budget hotel room start-up Oyo and ride-sharing company Ola.

“SoftBank’s re-investment in Flipkart is driven by our experience and the belief of the company’s management team to continue serving the needs of Indian consumers for decades to come,” said Lydia Jett, partner at SoftBank Investment Advisers, in a statement.

India’s e-commerce potential

Most of the retail business in India takes place in brick and mortar stores, but the online the potential remains enormous: India has one of the fastest growing and largest internet populations in the world.

In recent years, a combination of reforms, a push toward digitization, and last year’s coronavirus pandemic – and subsequent national and regional lockdowns – has shifted some of the transactions online.

In the last three months of 2020, India’s e-commerce sector grew 36% in volume and 30% in value year-over-year, according to a joint report by Unicommerce and Kearney.

The personal care, beauty and wellness category grew 95% year-over-year, while consumer goods and health care grew 46%. According to the report, most of the incremental growth was driven by sharp spikes in e-commerce volume and value in India’s tier 2 and tier 3 cities.

Flipkart’s competitors include US e-commerce giant Amazon, which has invested billions of dollars in the Indian market, as well as local names like JioMart, Reliance Industries’ online grocery delivery app.

For its part, the Indian government reportedly proposed new draft e-commerce rules in June that are expected to affect Flipkart and Amazon India.