Paytm Mall has joined the ranks of a unicorn, a company with a more than $1 billion valuation, after investors committed to infuse Rs 2,900 crore (about $450 million) in the online retailer. Japan’s Softbank Group Corp. and existing investor Alibaba Group Holding Ltd have made this committment in a new round of funding that will come in four tranches.
The deal values Paytm Mall, run by Paytm E-commerce Pvt. Ltd, between $1.6 billion and $2 billion. This comes at a time when global retail giants are taking a keen interest in India’s online retail companies.
Paytm Mall is SoftBank’s second investment in online retail in India. It is looking at exiting or reducing the first one, which was made along with Tiger Global, in Flipkart. There have been talks of Softbank’s equity stake sale in Flipkart to Walmart Inc. Paytm Mall directly competes with Flipkart.
“This latest investment led by Softbank and Alibaba reaffirms the strength of our business model, growth trajectory, execution capability and the potential of India’s massive O2O model in the retail space,” said Amit Sinha, chief operating officer of Paytm Mall, which serves 700 towns and cities in India.
It has currently partnered with 75,000 stores and aims to triple its offline presence by the end of 2019. The company works with offline stores in partnership with brands such as Samsung, LG, Lenovo, Intel, Red Tape, Canon, HP, Godrej, Hitachi, Bluestar, Whirlpool, Bosch, IFB and Intex among others.
One97 Communications Ltd, the parent entity that owns brand Paytm, spun off the e-commerce business into a new mobile application and a separate website in February 2017.