Flipkart fund investor now become the largest shareholder in firm

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This investment makes Softbank, the second largest shareholder in the company. Grocery is the largest segment of the retail market in India with an estimated annual turnover of $350 billion annually.

The funding from SoftBank takes Flipkart's cash reserves to more than $4 billion. The SoftBank investment follows the $1.4bn funding raised by the Indian company in April from technology companies Tencent, eBay and Microsoft. Between them, Flipkart and Snapdeal account for more than 50% of the Indian online shopping market, though Amazon India is a growing rival.

India's Flipkart has secured almost US$2.5bil (RM10.7bil) in funding from Japan's SoftBank Group, giving the online retailer more firepower to compete with Amazon in the country's burgeoning e-commerce market. SoftBank's $2.5-billion cheque to Flipkart comes a decade after Bezos surrendered China to Alibaba, the most successful investment by Masa, which turned a startup into an all conquering internet dragon. Flipkart will now be valued at $14.2 billion, sources said. "SoftBank's proven track record of partnering with transformative technology leaders has earned it the reputation of being a visionary investor", Flipkart co-founders Binny Bansal and Sachin Bansal said in a joint statement.

Meanwhile, Amazon has been making moves of its own.

Flipkart, which started by selling books on the Internet in 2007, was struggling to raise money until previous year, hobbled by a tough private funding environment and shrinking valuations. "In Indian e-commerce, Flipkart is doing that every day", said Masayoshi Son, Founder and Chairman and CEO of SoftBank Group Corp., who previously publicly announced his long-term commitment to investing in India.

"India is a land of vast opportunities", Son said in a statement on Thursday.

Earlier reports had suggested that Softbank was in talks with Flipkart to invest at least ₹10,000 crores.

However, that plan soured after Snapdeal made a decision to remain independent.

Flipkart is the biggest ecommerce firm in India, with around 37% market share, according to industry estimates. After this investment, Vision fund will become one of the biggest stakeholders in Flipkart.

The investment also needs to be seen in view of the appeal of the burgeoning Indian e-commerce market. In April, the firm funneled about $260 million through a subsidiary to the parent company of Ola, India's largest homegrown ride-hailing service.

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