US-based mutual fund Morgan Stanley has marked down the value of its shares in India’s largest e-commerce marketplace Flipkart by 38 per cent, dropping the valuation of the company significantly low to $5.58 billion.
In a filing with the US Securities and Exchange Commission on November 28, Morgan Stanley valued its holding in Flipkart at $52.13 per share for the three months that ended on September, while in the previous quarter this stood at $84.29 per share.The mutual fund currently holds 1,969 shares in Flipkart that are collectively valued at $102,644.
This is the fourth consecutive markdown by Morgan Stanley, one of the bigger mutual fund investors in India’s most valuable startup and its largest to date, after a 27 per cent markdown in February this year.
This effectively pegs the company’s valuation at $5.54 billion, compared to $9 billion in the previous quarter and $15.2 billion when it last raised capital in July 2015.
In the last few months, company’s valuation has seen multiple markdowns. For instance in July, Global asset manager T. Rowe Price Group Inc. reduced the value of its stake in Flipkart by a fifth, its second cut in four months. That valued Flipkart at $10.3 billion. The firm had earlier cut the value of its stake in Flipkart by 15 per cent in April. The most recent of all was Morgan Stanley that pegged Flipkart’s valuation at $9 billion.
The recent markdown, however, is less than ideal for the home-grown major as, according to few reports, the company has initiated talks for fresh round of funding. The e-tailer is said to be in talks with Walmart for an investment of upto $1 billion, a deal which could potentially help both the companies take on Amazon in India.