Flipkart in Headlines to Raise $100 Million Funding Round in Ninjacart
According to persons knowledgeable on the matter, Flipkart is in advanced talks to lead a new $100 million fundraising round in fresh produce supply chain company Ninjacart. This will be one of the largest investment rounds in a startup by the e-commerce behemoth as it seeks to expand its influence in India's rapidly developing online grocery market.
According to insiders, Ninjacart's valuation is expected to rise from $500 million to roughly $750-800 million following the investment round, with Flipkart parent Walmart also expected to join. Once the deal is finalised, it will strengthen Flipkart's relationship with Ninjacart as it seeks to expand its grocery business in order to compete with rivals such as Reliance Industries' JioMart, Amazon India, and Tata-owned BigBasket.
“Ninjacart’s business has made a good recovery over the last one year and the new funding is closing now; other existing investors are also likely to participate in this round,” according to one of the people mentioned above, the entire investment might “stretch to over $100 million.”
The Flipkart Group is scaling its online store Supermart as well as its 90-minute hyperlocal delivery service Flipkart Quick, which mostly concentrates on groceries but also contains select products in other categories like as electronics, as part of its increased focus on the sector.
After initially investing in the firm in 2019, Walmart and Flipkart combined to invest roughly $30 million last year.
Tiger Global, Accel Partners, and Nandan Nilekani and his family are among Ninjacart's investors. According to shareholding statistics from data tracking platform Tracxn as of October 2020, New York-based Tiger Global is the firm's top investor, owning roughly 23% of the company.
Ninjacart, which launched in 2015, is presently available in seven cities: Bengaluru, Chennai, Hyderabad, Pune, Delhi, and Mumbai, while Flipkart Quick is available in ten cities with aims to expand to 200 by the end of 2022.
Flipkart's extended grocery delivery service, which competes with Amazon Fresh and JioMart, is now available in 500-600 towns throughout the country.
“They (Flipkart) were in around 100 cities earlier in the year and scaled it to more than 500 before the Big Billion Days sale. Flipkart will continue to focus heavily on grocery and will be expanding across the country. Ninjacart’s support on the supply side will be crucial,” according to a source familiar with the situation.
As ecommerce companies choose a dual approach to the e-grocery industry — rapid delivery with limited items while simultaneously offering a wider choice of products with discounts and other incentives — a dual approach to the e-grocery business is becoming more popular. Ankur Pahwa, an EY India partner who monitors the e-commerce and consumer internet sectors, said, “having control over the supply chain helps in ensuring wider selection of products, higher quality control, certainty in terms of supply, and better unit economics.”
According to sources, “they (Flipkart) are essentially looking at Flipkart Quick as a service for the top 20-30 cities where the urban user is looking for faster deliveries and might even want to pay a premium for such deliveries. The broader grocery business is for across the country where it has also partnered with kirana shops.”
According to research from PGA Labs, Praxis Global Alliance's market intelligence branch, the Indian e-grocery business is expected to reach $22 billion by 2025, up from roughly $3 billion in the fiscal year ended March 2021. BigBasket was the market leader with roughly 37% market share, followed by Grofers with 13%. Flipkart had an 11 % market share, followed by Amazon India (15 %) and JioMart (4 %).
E-commerce consultant Publicis Commerce's Kartik G Iyer remarked, “in grocery, the fresh category (vegetables and fruits) leads to more stickiness. Fresh category can be a differentiator for both BigBasket and Flipkart as they can offer more products and better quality because of their control over the supply chain.”
According to insiders, Ninjacart's valuation is expected to rise from $500 million to roughly $750-800 million following the investment round, with Flipkart parent Walmart also expected to join. Once the deal is finalised, it will strengthen Flipkart's relationship with Ninjacart as it seeks to expand its grocery business in order to compete with rivals such as Reliance Industries' JioMart, Amazon India, and Tata-owned BigBasket.
“Ninjacart’s business has made a good recovery over the last one year and the new funding is closing now; other existing investors are also likely to participate in this round,” according to one of the people mentioned above, the entire investment might “stretch to over $100 million.”
The Flipkart Group is scaling its online store Supermart as well as its 90-minute hyperlocal delivery service Flipkart Quick, which mostly concentrates on groceries but also contains select products in other categories like as electronics, as part of its increased focus on the sector.
After initially investing in the firm in 2019, Walmart and Flipkart combined to invest roughly $30 million last year.
Tiger Global, Accel Partners, and Nandan Nilekani and his family are among Ninjacart's investors. According to shareholding statistics from data tracking platform Tracxn as of October 2020, New York-based Tiger Global is the firm's top investor, owning roughly 23% of the company.
Ninjacart, which launched in 2015, is presently available in seven cities: Bengaluru, Chennai, Hyderabad, Pune, Delhi, and Mumbai, while Flipkart Quick is available in ten cities with aims to expand to 200 by the end of 2022.
Flipkart's extended grocery delivery service, which competes with Amazon Fresh and JioMart, is now available in 500-600 towns throughout the country.
“They (Flipkart) were in around 100 cities earlier in the year and scaled it to more than 500 before the Big Billion Days sale. Flipkart will continue to focus heavily on grocery and will be expanding across the country. Ninjacart’s support on the supply side will be crucial,” according to a source familiar with the situation.
As ecommerce companies choose a dual approach to the e-grocery industry — rapid delivery with limited items while simultaneously offering a wider choice of products with discounts and other incentives — a dual approach to the e-grocery business is becoming more popular. Ankur Pahwa, an EY India partner who monitors the e-commerce and consumer internet sectors, said, “having control over the supply chain helps in ensuring wider selection of products, higher quality control, certainty in terms of supply, and better unit economics.”
According to sources, “they (Flipkart) are essentially looking at Flipkart Quick as a service for the top 20-30 cities where the urban user is looking for faster deliveries and might even want to pay a premium for such deliveries. The broader grocery business is for across the country where it has also partnered with kirana shops.”
According to research from PGA Labs, Praxis Global Alliance's market intelligence branch, the Indian e-grocery business is expected to reach $22 billion by 2025, up from roughly $3 billion in the fiscal year ended March 2021. BigBasket was the market leader with roughly 37% market share, followed by Grofers with 13%. Flipkart had an 11 % market share, followed by Amazon India (15 %) and JioMart (4 %).
E-commerce consultant Publicis Commerce's Kartik G Iyer remarked, “in grocery, the fresh category (vegetables and fruits) leads to more stickiness. Fresh category can be a differentiator for both BigBasket and Flipkart as they can offer more products and better quality because of their control over the supply chain.”
