SoftBank-backed Indian ecommerce platform Snapdeal is considering an IPO that could raise $400 million. With this Snapdeal will join the growing list of startups that are preparing to tap the capital markets as India sees a boom in the digital economy.
The company is in talks with its advisers about the potential listing in Mumbai at a valuation of about $2.5 billion. According to company sources, the IPO could take place by next year since discussions are still in a nascent stage.
Founded in 2010, Snapdeal is based in Gurgaon a suburb of New Delhi. It was once one of the top three ecommerce startups along with the Indian arm of Amazon.com Inc. and Flipkart Online Services Pvt. Four years ago Snapdeal had quit a potential merger with Flipkart. The merger would have united the two local ecommerce platforms against Amazon.
Flipkart, since then has sold a controlling stake to Walmart Inc. and is now heading towards its initial public offering.
In India, the amount raised through IPOs in 2021 has already exceeded the total of the last three years. Within the first four months of this fiscal year, as many as twelve firms have raised about $370 million (Rs 27,000 crore) through an initial public offering.
Head of Equities and Sanctum Wealth Management, Mr. Hemang Kapasi told news agencies that in the financial year 2022 as many as 40 IPOs are coming up. He added that the companies are looking to raise about $960 million (Rs 70,000) through public listings.
Snapdeal was founded by Rohit Bansal and Kunal Bahl and is one of the largest no-frills ecommerce marketplaces in India. The startup offers over 60 million products across 800 categories and delivers to over 6000 towns and cities in India.
The wide selection of product range includes kitchen, home, fashion accessories, apparel, books, mobile, electronics, among others.
Snapdeal is backed by a range of investors such as Alibaba, Teamsek, Foxconn, BlackRock, SoftBank among others.