Flipkart shares marked up 10% by Valic, co now valued at $11.6 bn

Flipkart, India’s largest e-commerce company, finally got some respite on the valuation front after the online retail firm’s shares were valued higher by one of its existing investor Valic Co. The mark-up in valuation for the Bangalore-headquartered company comes following a series of valuation mark-downs in recent months by the several of the company’s foreign investors.  According to a regulatory filing with the US Securities and Exchange Commission, the mutual fund firm Valic Co said it has marked up the etailer’s shares by 10 percent at $108.04 apiece by May-end compared with $98.19 in the previous quarter, a Times of India report said. Following the latest mark-up in value of shares by Valic, Flipkart is now valued at close to $11.6 billion after the fund had marked down the company’s shares in consecutive quarters by 20.2 percent and 12 percent, respectively, to $10.5 billion. This, however, is still down from Flipkart’s peak valuation of $15.2 billion when it last raised capital in July 2015, the Economic Times reported. Before Valic, Fidelity, too, had recently valued the online retail firm’s shares marginally higher valuing it at $9 billion, the ToI report said. Before the latest mark-up, Flipkart had in fact faced six valuation markdowns this year. In July, US-based investment firm Vanguard Group slashed the holding value of its investment in Flipkart by as much as 25 percent in the quarter through March. From $136.87 a piece Vanguard bought on 30 September, 2015, the US-based investment firm slashed its value to $102.65 as on 31 March, 2016. Besides this, a fund managed by Morgan Stanley reduced the value of its investments twice while Fidelity Rutland Square Trust II, Valic Co., and T. Rowe Price also each lowered the value once. In May, Morgan Stanley Mutual Fund Trust, a mutual fund investor in Flipkart Ltd, had lowered its estimate of the online retailer’s valuation by 15.5 percent for the second successive quarter in a row. Similarly, in April, T. Rowe Price disclosed in a filing that it cut the value of its stake in Flipkart by 15 percent. On the series of markdown, Sachin Bansal in an interview had said, “I do not think much of the markdowns. We should just focus on execution and keep our heads down on serving our customers." This markup comes at a time when Flipkart is facing stiff competition from the US-based Amazon, which is rapidly closing the gap with its Indian competitor.