Paytm Mall in talks to raise $600mn from SoftBank, others
SoftBank and Alibaba-backed Paytm Mall is learnt to be in the final stages to close a $600 million funding round at a valuation of over $2 billion. This round might see the entry of yet another major fence-hitter, Primavera Capital Group, a China-based investment firm.
“After the completion of this round, Paytm Mall will officially be a unicorn, as its valuation will swell to over $2 billion,” a source said.
According to sources, Paytm Mall is in talks with SoftBank, Singapore state investment arm Temasek Holdings and Primavera.
Sources said the talks for raising money started soon after SoftBank put in $1.8 billion in the Vijay Shekhar Sharma-led firm, picking nearly 30 per cent stake in the company last year.
Amit Sinha, chief operating officer, Paytm Mall, refused to comment. SoftBank started its India investments with Snapdeal, where it invested close to a billion dollars. Last year, it made its biggest investment yet with close to $2.5 bn in Flipkart. This investment would also make SoftBank the biggest rival of Amazon India.
In an interview with Business Standard in January, Sharma had said Paytm Mall was planning a major expansion. It is concentrating on getting its e-grocery segment right and hopes to earn a gross merchandise value (GMV) of more than $3 billion from just the online grocery segment.
Sharma, the founder of One97 Communications that owns Paytm Mall, said: “The biggest learning that I have got is that grocery is the fastest growing category in e-commerce. Consumers come back again. We have a daily needs section in Paytm Mall for that reason. At the present level, around 25 per cent of the GMV at Paytm Mall comes from grocery; it will go up to 40 per cent. I think groceries would contribute around $3-billion GMV by the end of the year.”
The company is fast bringing in more fast-moving consumer goods brands on its platform as well as getting into hyperlocal tie-ups with grocers to increase its logistics.
Paytm Mall hopes to take on Amazon, which gets more than 50 per cent of daily grocery orders. Amazon is also running a number of programmes, including Amazon Pantry and Amazon Now, its two-hour grocery delivery service.