NEW DELHI—Indian e-commerce startup Flipkart Group has raised $1.4 billion from Microsoft Corp., eBay Inc. and Tencent Holdings Ltd., taking a hit to its valuation to raise the cash it needs to defend its home market from Amazon.com Inc.
Flipkart, which was started in 2007 by two former Amazon employees, said Monday that the new investment values the Bangalore company at $11.6 billion. That allows Flipkart to retain its title as India’s most valuable startup but is still a step down from the $15 billion valuation it received during fundraising in 2015.
“This is a landmark deal for Flipkart and for India,” Flipkart founders Sachin Bansal and Binny Bansal said in the statement, calling it the company’s biggest fundraising round ever.
Flipkart said Chinese internet firm Tencent led the round, but a Flipkart spokeswoman declined to provide a breakdown of investments by company.
Separately, eBay said on Monday that it was selling its Indian business to Flipkart and was making a $500 million cash investment in the startup for an equity stake.
MUMBAI—A Morgan Stanley investment fund has reduced the valuation of its holding in Flipkart Internet Pvt. by 38%, as India’s leading e-commerce firm faces increased competition from U.S. rival Amazon.com Inc. and others.
In a U.S. regulatory filing this week, the Morgan Stanley Select Dimensions Investment Series fund said for the quarter ended Sept. 30, it held 1,969 Flipkart shares, which it valued at $102,644, or $52.13 a share.
For the preceding quarter, the fund—part of Morgan Stanley Investment Management, the company’s asset management division—reported the same number of shares in the startup, but valued them at $165,967, or $84.29 a share
In a statement, a Flipkart spokeswoman said the Morgan Stanley fund’s markdown was a “purely theoretical exercise” that is “not based on any real transactions.”