Paytm-owned Paytm Mall is in discussion to raise $450-600 million in fresh funding, according to a report.
The home-grown company is planning to cease the funding round by the end of the year and is talking to financial investors from Asia and the US, reported the ET quoting a person familiar with the development.
“Paytm Mall is planning to close the new round of funding by end of this year and is talking to financial investors from Asia and the US,” said the person who didn’t wish to be named.
Noida-based firm has been aggressively looking investments and buyouts to garner more market share in Indian e-commerce market, which has players like Flipkart, Snapdeal and Amazon. Flipkart and Amazon are considered to be leading the market and are aggressive in their tactics to grab the market share.
Paytm in order to compete with existing players is planning to have fresh acquitions and strengthening logistics network. It is looking to buy into e-grocer BigBasket. According to recent media reports, the two are set to invest about $200 million in SuperMarket Grocery Supplies Pvt. Ltd, which runs BigBasket, at a pre-money valuation of $600 million.
It is also planning to invest $35 million in its technology and logistics infrastructure, besides adding more product offerings. It also plans to cut down on delivery timelines for partner merchants. It is likely that a portion of the funds raised will go towards building its logistics infrastructure, the ET report added.
In June, Paytm E-Commerce raised $200 million from Alibaba and venture capital firm SAIF Partners. Following the transaction, the combined stake of Alibaba and its affiliate Ant Financial in Paytm E-Commerce rose from 40% to 62%.
Armed with a revamped mobile app featuring 1,000 brand stores and 15,000 brand authorised retailers, Paytm Mall has announced a Rs 100 crore advertising budget for the festive season.
In 2017, e-commerce firms in India saw their best-ever performance over the five-day festive sales period in 2017, generating Rs 9,000 crore ($1.5 billion) in sales. During this BBD, Flipkart did sales which equals 70 percent of the entire online e-commerce market in India. According to the company, smartphone was the hottest category during the Big Billion Days. It claimed to sell 1.3 million smartphones within the first 20 hours of the category opening for sale.
Amazon also made similar claims like its rival Flipkart and insisted it remains the largest marketplace and the fastest growing one in Indian e-commerce landscape.
Paytm Mall has lined up Rs 1,000 crore to spend on marketing, cashback and promotions during September-October. Surely, the space is going to see some hot competition.