Is this a good deal for flipkart ???

 

Yes, according to most experts. After Walmart bought the controlling stake, Flipkart is valued at more than $20bn.

The deal also saves Flipkart, which was running out of cash in its battle with Amazon. Both competitors have been “burning cash” in massive sales and discounts pegged to Indian festivals in a bid to acquire more customers.

Amazon runs a profitable business worldwide, thanks to its cloud computing service, and it has the cash to take on newer markets.

Flipkart, however, needs the financial strength Walmart offers. It has also managed an excellent valuation, by all accounts, giving both its co-founder Sachin Bansal, and several of its key investors, profitable exits.

This is the highest price any foreign company has paid for a stake in an Indian company. New York-based angel investor Gautam Gandhi said Flipkart’s founders had been elevated from “role models to demi-gods for aspiring entrepreneurs”.

Leave a Reply

Your email address will not be published. Required fields are marked *