Paytm Mall to raise $446 mn from SoftBank and Alibaba
Paytm Mall, the e-commerce arm of Paytm, has raised around ₹2,900 crore from SoftBank Investment Holdings and Alibaba.com Singapore, as per an RoC filing.
The company will use the funds to deploy its tech for shopkeepers, enhance logistics and strengthen its brand, Amit Sinha, chief operating officer at Paytm Mall, told TechCircle.
Prior to this latest round of funding, Alibaba and Alipay together held over 56 per cent, while Paytm founder Vijay Shekhar Sharma's holding stood at more than 12 per cent. SAIF Partners held over 24 per cent stake. Japanese investment giant Softbank will contribute Rs 2,600 crore in the round while rest of the contribution will come from Alibaba. Paytm Mall has already received the first tranche of this round, which is Rs 357.5 crore.
SoftBank, which now has an installed and under-construction solar capacity of 750 MW, itself sought very low tariffs in its last bids in May 2017, where it quoted 2.45 rupees per unit. The Japanese group is also one of the biggest investors in Snapdeal, another Indian e-tailer. It was also reported that Paytm Mall has put a target to achieve $10 Bn gross merchandise volume run rate by end of FY19. Paytm Mall competes with Flipkart, which investors SoftBank and Tiger Global are planning to sell to Walmart.
According to the company, offline stores registered on its platform drive over 60% of sales.
The company now 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.
Owing to its different business model, Paytm Mall has certainly earned a niche for itself in the highly competitive e-commerce market. The platform Paytm Mall is inspired by Alibaba's T-mall in China. Currently, they hold 57 per cent together, and it will go down to 46 per cent while SoftBank Vision Fund will hold 21 per cent.
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