BUSINESS

Loss-Making Flipkart Paid In Excess Of ₹1 Crore To 101 Staff, ₹35 Crores To One Exec Alone: Report

Flipkart has seen several valuation markdowns in the past year.

05/01/2017 4:17 PM IST | Updated 05/01/2017 4:59 PM IST
Abhishek Chinnappa / Reuters

Losses at India's biggest e-commerce player Flipkart more than doubled in its latest fiscal to ₹2,306 crores compared to previous year. But the fat payouts at the startup would suggest otherwise.

According to a Quartz report, between April 2015 and March 2016, the e-commerce player paid over ₹300 crores in staff remuneration, with six senior staff making in excess of ₹10 crores, and over 101 staff receiving payouts exceeding ₹1 crores.

Flipkart's Chief People Officer Mekin Maheshwari reportedly made ₹35.3 crores, while former CEO-Commerce Platform Mukesh Bansal was paid ₹21.8 crores. Its Chief Technology Officer, Amod Malviya made about ₹11.7 crores. A former senior vice president, Sameer Nigam, and vice president each made about ₹17.7 and ₹10.1 crores respectively.

These payouts included salary, provident fund, and other allowances, the report said. In a statement to Quartz, Flipkart clarified, "The remuneration figures cited include a significant portion of liquidated ESOPs that had been accumulated over the years... The law does not require liquidation of ESOP details to be separately stated and the (RoC) filings have been made by disclosing all the particulars mandated by the law."

In comparison, Amazon India head Amit Agarwal made ₹3.16 crore in renumeration in fiscal 2016.

While the Flipkart compensation looks excessive, it's not unusual for Indian IT startups to pay high salaries to attract top talent.

Late last year, a Morgan Stanley mutual fund, revised down the company's valuation by a whopping 38 per cent to $5.54 billion, in what was its fourth markdown by the fund in nine months. Flipkart is said to be in the market to raise up to $1 billion from investors. It faces tough competition from global e-commerce giant Amazon that is increasing investments in India.

At the time of its last round of funding in mid-2015, Flipkart was valued at $15.5 billion. For its most recent fiscal, Flipkart posted revenues of ₹1,952 crores, up about 153 per cent over from the previous year.

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