Chinese giant Tencent pumps money into Flipkart: Details here
Chinese tech giant Tencent is pumping money into Flipkart, India's leading online shopping platform. The investment is not big for the e-commerce company, which is valued at over $24 billion, but it comes at a time when incoming capital from the neighboring nation is facing extra scrutiny due to the ongoing border tensions. Here's more about it.
As per filings sourced by paper.vc, Tencent is investing $62.8 million in Flipkart. The companies have not commented on the development, but according to the outlet's report, the funding is probably a part of a larger round led by Walmart, the US-based parent company of the etailer, and other existing backers of Flipkart.
Going by reports, the larger round in question is the one that Walmart had announced a few months ago. Back in July, the retail conglomerate had said that it as well as other existing shareholders would invest $1.2 billion in Flipkart in two tranches. The investment had valued the firm at $24.9 billion, with Walmart's ownership rising to a significant 82%.
As for Tencent, the company reportedly owns a 5% stake in Flipkart through its Singapore-based investment holding company Aceville Pte Ltd. Apart from Flipkart, Tencent has also invested in more than a dozen Indian start-ups and unicorns, including ed-tech player BYJU's, OLA, Doubtnut, Dream11, NiYO, Gaana, Hike, KhataBook, MXPlayer, MyGate, Pocket FM, Practo, Swiggy, and Udaan.
Tencent has had a smooth run in India, but this year has been different as the company has faced major hurdles due to the ongoing Indo-China border stand-off. The Indian government has tightened FDI rules to mandate government approvals on capital coming from China and has also banned more than 150 apps from the company, including Tencent's famous PUBG MOBILE and PUBG MOBILE Lite.
In light of this scrutiny, and the general anti-China sentiment prevailing in India, Tencent is focusing on setting up an office in Singapore. There have also been reports that the company is looking at selling its stake in at least one of its Indian investments - Dream11. Other Chinese companies, including ByteDance and Alibaba, are also moving to Singapore to grow their footprint.
