SoftBank-backed Snapdeal weighs $400 mn share sale
MUMBAI: E-commerce retailer Snapdeal Pvt is considering an initial public offering that could raise about $400 million, joining a growing list of startups preparing to tap capital markets as the nation’s digital economy booms.
The company, which counts SoftBank Group Corp. among its investors, is speaking with advisers about a potential listing in Mumbai that could value it at as much as $2.5 billion, the people said. An initial public offering (IPO) could take place as soon as next year, they said, asking not to be identified because the details aren’t public.
Discussions are still at an early stage, and the firm could decide not to proceed with the plan, the people said. Representatives for Snapdeal and SoftBank declined to comment.
Snapdeal, based in the New Delhi suburb of Gurgaon, was once one of the country’s top three e-commerce firms along with Flipkart Online Services Pvt. and the Indian unit of Amazon.com Inc.
Founded in 2010, it offers more than 60 million products across 800 categories on its platform and delivers to more than 6,000 cities and towns, according to its website.
Four years ago, Snapdeal walked away from a potential merger with Flipkart, which would have united the two local-e-commerce companies against Amazon. Since then, Flipkart sold a controlling stake to Walmart Inc. and is now progressing towards its own IPO.
The amount raised through IPOs in India so far in 2021 has already surpassed the total gathered in the last three years. The pipeline for the rest of the year includes payments service provider Paytm, online insurance platform Policybazaar and e-commerce beauty startup Nykaa.
In just the first four months of this fiscal year as many as 12 firms have raised ₹27,000 crore through the IPO route. However, public issues worth ₹70,000 crore are still in the pipeline for the remainder of the fiscal year.
Hemang Kapasi, head of Equities at Sanctum Wealth Management, told news agencies that as many as 40 IPOs are yet to come up in FY22. He added that the firms would be looking to raise ₹70,000 crore through these public issues.