Ecommerce major Flipkart’s talks with Zepto for a potential stake purchase deal has fallen through and are unlikely to be revived, The Economic Times reported on April 19.
Zepto is in talks with a private equity funds along with existing investors to close a fresh funding round. It is expected to get a valuation of nearly $2.5 billion on the back of the momentum in the quick commerce sector in the past few months, according to the report.
Flipkart’s interest in Zepto shows its appetite in the instant-delivery segment in which it has lagged. Flipkart has plans to launch its own quick delivery service with a time limit of deliveries under 30 minutes.
The Bengaluru-based company had previously also been in talks with quick commerce player Dunzo for a significant investment but those talks didn’t progress. Techcrunch was the first to report on the Flipkart-Dunzo discussions.
Dunzo was also approached by PhonePe for its ONDC-led ecommerce business but the transaction didn’t go through as the company’s board blocked the proposal, the ET report said.
Open Network for Digital Commerce (ONDC) is an Indian government-backed marketplace for sellers and offline businesses to counter the dominance of Amazon and Flipkart.
A UBS report released this month said the quick ecommerce sector is likely to achieve a gross merchandise value (GMV) or total sales of around $34 billion by FY29 with a total addressable market (TAM) potential of $520 billion.
“We believe the three large quick commerce platforms currently have a comfortable advantage on the core infrastructure needed — rollout of dark stores and logistics infrastructure — although a more fragmented market structure over the medium term cannot be ruled out,” the report said
