Indian ecommerce company Flipkart has raised $3.6bn in funding for a valuation of $37.6bn, with main shareholder Walmart leading the round alongside SoftBank and Singapore’s sovereign wealth fund GIC.

Flipkart is up against Amazon and India’s richest man Mukesh Ambani, the chair of Reliance Industries, for the country’s middle-class consumers, who are rapidly coming online in the age of cheap data and after the pandemic.

The latest fundraising round comes as Walmart-backed Flipkart is considering going public and New Delhi is seeking to tighten ecommerce regulations. The new rules propose to limit “flash sales” and could force Flipkart and Amazon to change their business structure again.

The draft rules, released in June, come at a time when Prime Minister Narendra Modi’s government is locked in a battle with Big Tech on issues ranging from foreign investment to free speech. The government has been challenging Twitter and Facebook over control and moderation of online content.

Flipkart said in a statement that the Canada Pension Plan Investment Board, sovereign fund Qatar Investment Authority and Tencent participated in the fundraising round. Walmart now holds a stake of about 74 per cent in Flipkart, according to people with knowledge of the transaction.

“This investment by leading global investors reflects the promise of digital commerce in India,” said Kalyan Krishnamurthy, chief executive of Flipkart Group. “We will focus on accelerating growth for millions of small and medium Indian businesses.”

SoftBank reinvested $500m in Flipkart three years after exiting entirely and selling its stake of about 20 per cent to Walmart. Lydia Jett, partner at SoftBank Investment Advisers, said SoftBank’s decision was driven by Flipkart’s ability to address the “needs of the Indian consumer in the decades to come”.

Flipkart said it had more than 350m registered users and 300,000 registered sellers, the majority coming from India’s underpenetrated “tier two” cities, home to the burgeoning middle classes that companies are trying to target.

The group also owns PhonePe, one of the leading payments apps in India, which is competing against India’s Paytm and Google Pay for dominance.

Amazon and Reliance have also been replenishing their war chests. Reliance Retail, Reliance Group’s retail arm, raised more than $6bn last year to help fuel its expansion into ecommerce.

Analysts predict that Flipkart could be planning an IPO for next year, following the path of other marque Zomato and Paytm, which are going public in the upcoming months.