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Naspers holds 16% in Swiggy, 14% in Flipkart, 43% in MakeMyTrip; Notes from its financial results

Naspers had put in $61 million of the $80 million round of funding into Swiggy in June 2017, the company has disclosed in its interim results. “Following the investment, the group holds a 16% effective interest (15% fully diluted) in Swiggy”, the company says in its report.

On May 30th, Swiggy had announced raising $80 million in Series E funding led by global internet and entertainment group Naspers, along with participation from existing investors Accel India, SAIF Partners India, Bessemer Venture Partners, Harmony Partners and Norwest Venture Partners. Ashutosh Sharma, head of investments in India for Naspers will join the Swiggy Board, the company had said then in a statement. More on Swiggy’s business and funding here.

Naspers also holds 14% (13% fully diluted) stake in Flipkart, having invested $71m for an additional interest the company in April 2017, and following multiple rounds of funding in which Naspers did not participate. “The additional interest was acquired from existing shareholders of Flipkart. Flipkart undertook various funding rounds during the reporting period [six months ending September 2017] in which the group did not participate. These funding rounds resulted in a dilution of the group’s interest in Flipkart and in the recognition of an aggregate net dilution gain of US$11m in “Dilution losses on equity-accounted investments” in the income statement.

Flipkart raised substantial capital from investors – including Tencent and Softbank – recently, including $2.5 billion from Softbank’s Vision Fund. In March, it had raised $1.4 billion from Microsoft and Tencent; incidentally, just 20 days before that announcement, Flipkart had called reports of that funding “speculative”.

PayU India accounts for 47% of PayU’s total payment volumes, and is up 120% year on year.  Naspers said that PayU processed payment volumes of $11.7bn during the first six months of the year. So, at 47% of total payment volumes, it would appear that PayU India processed $5.5 billion in the first six months of the year. Naspers expects the core payments service provider business to break-even by the end of the financial year. Note that PayU (including India and other markets) had processed over $16 billion in the last financial year, so it appears to be well on course to beat that.

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Remember that PayU invested $99m for a non-controlling stake of 38% (31% on a fully diluted basis) in Kreditech, a credit-scoring business, and committed a Euro 20M convertible loan funding to Kreditech in the future. PayU plans to extend these consumer credit services in its key markets.

On the whole, PayU recorded revenue growth of 52% on the back of a 75% increase in transaction volumes year on year. It reported 1.8 million average daily transactions for the period, up from 1 million last year.

Note that Year on Year trends are affected by PayU’s acquisition of Citrus Pay and Kreditech. PayU had bought 100% stake in Citrus Pay last year for a total of $112 million, with an additional $18 million as “employment-linked prepayment”. The purchase price allocation, according to Naspers: “net debt $1 million; net working capital $2 million; intangible assets $ 15 million; deferred tax liability $5 million and the balance of $105 million to goodwill. The main classes of intangible assets recognised in the business combination were trademarks, customer bases and technology.”


Naspers invested $132 million in MakeMyTrip in May 2017 as a part of a funding round with CTrip. In that round, MakeMyTrip raised a total of $330 million, so it seems that $198 million was put in by CTrip. Naspers followed that up with an additional $23 million investment in order to main its shareholding (of 43%; 40% on a fully diluted basis) when MakeMyTrip issued share options to its employees in August and September 2017.

Source: Naspers reports, presentation.

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