Paytmâ€™s ecommerce arm Paytm Mall is upping its ante in the ecommerce space with its marquee investor SoftBank pumping in $200 million as part of the overall deal of investing $445 million into the company.
Having already received $200 million this round, the balance $25 million was brought in by the Chinese giant Alibaba, which will ultimately end up holding a major chunk, around 46% of the stakes in Paytm Mall while SoftBank will hold 21%. This will be after accounting for this fresh round of investments. The current tranche of $200 million has come from one of SoftBankâ€™s subsidiaries, SB Investment Holdings
It is quite clear that both SoftBank and Alibaba wish to play an aggressive game in the Indian ecommerce space and with Walmart having entered the fray by buying a majority stake in Flipkart and Amazon already sharpening its knives. And so far, Paytm is playing ball by expanding its offerings and by strengthening its base at the retailer level.
As part of this fundraising round, SoftBank has also inducted its own nominee on the board of Paytm Mall. The development also saw John Michael Evans of Alibaba also stepping down from the board of directors of the company. The long-term plan is to pump in around $3 billon and make the ecommerce arm of the Indian company One97 a force to reckon with in the Indian ecommerce space.
The coverage by Paytm Mall in terms of making deliveries to its customers for orders placed on its site or app now stands at around 19,000 pin codes. It can be hoped that this number will increase in the future. Having started out as a payment gateway using the Paytm app and QR code scan method, Paytm Mall has a strong bonding and relationship with the offline retailers also which will come handy in scaling up its business swiftly. It has set an ambitious $10 billion target for itself in terms of the gross merchandise volume through its venture by 2019.