Google, a tech major, is investing nearly $350 million in Flipkart, an e-commerce firm owned by Walmart, for a minority share. It was mentioned that this investment was part of the $1 billion funding round initiated by Flipkart in 2023.

It was not disclosed by Walmart-backed Flipkart the amount invested by Google or the valuations of the company.

It was stated in a release that as part of the most recent funding round led by Walmart, Flipkart announced on Friday that Google would be added as a minority investor, pending regulatory and other customary approvals by both parties.

The funding would assist the firm as it aimed for a valuation of around $60 billion at the time of its initial public offering (IPO), now scheduled for 2025-26 rather than this year. It was also mentioned that the firm might contemplate listing in India and other regions, including the US.

It was anticipated that the latest financing would value the Bengaluru-based firm at a 5-10 per cent premium compared to its previous valuation of $33 billion. It was projected that the new valuation could exceed $36 billion. The valuation of Flipkart had been adjusted to $33 billion after the separation of fintech firm PhonePe from the group in December 2022.

Google entered into the deal because Flipkart was a leader in the e-commerce sector. The person mentioned that the company planned to use the capital to expand its infrastructure, seller support ecosystem, and adopt latest technologies such as artificial intelligence (AI) and generative AI.

It was noted that Flipkart had previously raised nearly $600 million from its parent company Walmart.

It was mentioned that Google would provide Flipkart with its Cloud offer as part of the deal. The firm stated that the collaboration would enhance the modernization of its digital infrastructure to cater to customers across the country.

According to individuals familiar with the company?s strategy, this fundraising would provide enough resources to Flipkart to compete with rivals such as Amazon, Reliance JioMart, and Tata Digital. It was also stated that it would help the company target the next 200 million customers in the country, especially in Tier-II and -III cities as well as rural India.

It was highlighted that this was another significant fundraising for the firm since 2021 when Flipkart Group, including PhonePe, raised $3.6 billion.

In July 2020, Walmart led a $1.2 billion round in Flipkart, valuing the e-commerce firm at $24.9 billion. In May 2018, it was announced by Walmart that it would pay $16 billion for an initial stake of approximately 77 per cent at a valuation of less than $21 billion.

It was mentioned that fintech firm PhonePe became a part of Walmart as a bolt-on acquisition. Following that, Walmart continued to participate in the funding rounds of Flipkart and PhonePe.

It was reported that Flipkart was planning to relocate its domicile from Singapore back to India. It was speculated that this move could result in significant tax benefits for the Indian government and was linked to eventual IPO plans.

According to analysts, India?s e-tailing sector was expected to witness a fivefold growth, from $59 billion in 2022 to an estimated $300 billion by 2030, driven by value-seeking ?mass? consumers. They attributed this growth to the increasing adoption of e-commerce in Tier-II cities and beyond.

It was noted that Flipkart was capitalizing on this trend, with a record 1.4 billion customers visiting its platform during its flagship festival sales event, The Big Billion Days 2023.