According to insiders, the talks for raising money started soon after SoftBank put in a $1.8 billion in the Vijay Shekhar Sharma-led firm picking nearly 30 per cent stake in the company last year. Amit Sinha, chief operating officer, Paytm Mall, refused to comment.
With this round of investment, SoftBank would be putting in the third major ecommerce marketplace in India.
The company started with Snapdeal, where it invested close to a billion dollars. Last year, it made its biggest investment yet with close to $2.5 billion in Flipkart. This investment would also make SoftBank the biggest rival of Amazon India.
Paytm Mall is on a rapid expansion mode. In an interview with Business Standard in January this year, Vijay Shekhar Sharma said that Paytm Mall is planning major expansion. It is concentrating on getting its e-grocery segment right and hopes to earn a gross merchandise value (GMV) of more than $3 billion from just the online grocery segment.
Sharma, the founder of One97 Communications, the company that owns Paytm Mall, said that while 25 percent of the GMV to the overall GMV of the online marketplace comes from groceries at present, by end of the year this would go up to 40 per cent. The company is fast bringing in more FMCG brands on its platform as well as getting into hyperlocal tie-ups with grocers to increase its logistics.
The company hopes to take on Amazon India, which gets more than 50 per cent of its daily grocery orders and is running a number of programmes, including Amazon Pantry and Amazon Now, its two-hour grocery delivery service. “The biggest learning that I have got is that grocery is the fastest growing category in e-commerce. The consumers come back again. We have a daily needs section in Paytm Mall for that reason. At present level, around 25 per cent of the GMV at Paytm Mall comes from grocery; it will go up to 40 per cent. I think groceries would contribute around $3-billion GMV by end of the year,” Sharma had earlier said.