Paytm Mall valuation takes a hit

Paytm Mall valuation – With its primary investors, Chinese internet giant Alibaba and investment firm Ant Financial, exiting the firm, Vijay Shekhar Sharma’s Paytm Mall, which is One97 Communications’ e-commerce operation, has experienced a dramatic decline in valuation.  

According to a statement made by the firm, Alibaba and Ant Financial are both departing Paytm Mall. 
 
Although the company did not disclose the current transaction valuation in detail, a note sent to Paytm Mall shareholders stated that the investors, Alibaba and Ant Financial (which held 28.3 percent and 15% of the company respectively), are exiting the company with a secondary share value of Rs 459 per share. 
 
“We’re focused on partnering with ONDC to establish a sustainable business, and we’re optimistic about the future of e-commerce in India. PEPL saw early investors leave as part of the reorganization of the company’s business direction. The exit price of any investor(s) in the company via capital reduction procedure is unrelated to the company’s valuation and has no bearing on any FDI legislation “In a statement, a spokeswoman for Paytm Mall said.

Paytm Mall valuation

According to the Hurun Unicorns lists for 2022, Paytm Mall was valued at significantly less than $1 billion, down from a reported $3 billion in 2020. In the face of fierce competition from Amazon, Flipkart, and Reliance, Vijay Shekhar Sharma’s bet on offline-to-online commerce through Paytm Mall flopped.

On Monday, Paytm Mall announced its move to India’s Open Network Digital Commerce (ONDC), with a focus on e-commerce exports. 
 
“We are ready to build on the Government of India’s pioneering ONDC effort to support online commerce in India,” a Paytm Mall official said. We also plan to look into export opportunities. We are grateful for the support of our investors and look forward to long-term success.” 
 
The departure of two important investors, Alibaba and Ant Financial, was also confirmed by the spokesperson. 
 
Sharma founded Paytm Mall in 2016 to capitalise on the growing online shopping trend, and the company was able to raise $500 million in a funding round headed by SoftBank and other investors, earning it the title of unicorn. In July 2019, the company secured another $160 million in a round led by e-bay. According to the Hurun India Unicorns report, Paytm Mall’s valuation would decline to less than $1 billion in the next few years.