E-commerce giant Flipkart may have dropped out of talks aimed at buying a stake in Zepto. As per a report by the Economic Times, A deal between Flipkart and Zepto has fallen through and isn't likely to be revived.
Zepo right now is in talks with a private equity fund to raise a fresh round of investment, The company is expected to get a valuation of approximately $2.5 billion.
“The companies met and Flipkart made an offer to Zepto valuing it at under $2 billion.. but the deal didn’t go ahead. Zepto’s decision to opt out was centred around Flipkart wanting to pick up a majority stake in the startup..,” said one of the persons cited in the ET report.
Flipkart itself wanted a majority stake in the startup, this shows the Walmart-backed e-commerce giant is interested in being a major player in the quick commerce industry. Notably, that is an area in which the company currently lacks.
The ET report further said that Flipkart is looking to launch its quick delivery service aimed at delivering goods in less than 30 minutes. The platform is expected to come to life in June and the company is setting up dark stores right now to meet the demand.
Flipkart's move to acquire or hold a majority stake in the fast-growing quick commerce is largely based on its growing demand and the pressure that it is putting on E-commerce giants like Amazon, Flipkart and Messho.
In the past month, several brokerage reports have highlighted the growing significance of quick commerce for brands and the potential pressure it may exert on major e-commerce players. According to a recent report by UBS, quick commerce has transitioned from being a "good to have" to an "indispensable" aspect. The report predicts that this emerging sector could achieve a gross merchandise value (GMV) of approximately $34 billion by FY29, with a total addressable market (TAM) potential reaching $520 billion.