Chinese online giant Alibaba’s talks with Flipkart for a stake in the Indian ecommerce company have “gone cold” after Walmart, the world’s largest retailer, seems to have breasted ahead in talks to acquire a strategic stake in the Bengaluru-headquartered company.

Details such as the amount of money Walmart has committed or the valuation of Flipkart in the latest round were not immediately clear but two sources said Walmart was definitely in, dimming the chances of Alibaba getting a firm foothold in one the world’s fastest growing e-commerce markets.

Two people familiar with the development said the talks with Jack Ma-led Alibaba weren’t going anywhere because the Chinese ecommerce giant was not ready to move beyond its offer that valued Flipkart at around $8 billion, nearly half of what it was valued in its last funding round in July last year.

“Alibaba wouldn’t budge,” said the first person.

Flipkart is now looking to bring a strategic investor capable of helping it compete with aggressive American rival Amazon and not just raise another round of funding. The Indian company has raised $3.15 billion so far in a dozen rounds from a large set of funders including marquee investors such as Tiger Global, Accel Partners, Naspers, and DST Global.

Deep-pocketed Amazon, led by Jeff Bezos, has committed $5 billion to its Indian operations so far. Online retailing in India is widely considered the last frontier of ecommerce in the world and is predicted to grow to $60 billion in 2020 from around $15 billion today.

“While cash is important, there’s more visibility on revenue than few months ago. What’s needed now is a strategic investor who can add value in helping compete,” the second source said about Flipkart’s stance. Both the sources did not want to go on record given that the deal has not closed yet.

“It is our policy not to comment on rumours or speculation,” a Flipkart spokesperson said when asked to comment on the development. FactorDaily has not heard from Walmart and Alibaba on our requests for comment; we will update this story when we do.

The current round of funding, according to the second person, will get closed by March next year. Alibaba could muscle back into the talks, the person added, but it would have to be at a significantly higher valuation than what it has offered Flipkart. Not only is this unlikely, it will also be unusual in such strategic rounds to accommodate more than one strategic investor.

On Tuesday, Rasul Bailay and Chaitali Chakravarty of The Economic Times reported that Walmart and Flipkart executives are expected to meet this week to explore the deal. As I wrote in June this year, Alibaba and Flipkart have been exploring a deal for months, in what could potentially become a new battlefront against Amazon.

But Flipkart wouldn’t agree to sell its shares for anything less that $15-$16 billion in overall enterprise valuation, and Alibaba wasn’t going beyond its initial $8 billion offer.

As we wrote last month, things have started improving for Flipkart since co-founder Binny Bansal took over as CEO and Kalyan Krishnamurthy moved in from Tiger Global for tightening the operations.

In an internal townhall meeting in August, Binny said Flipkart, in the April-June quarter, had improved its gross profit margin by 400 basis points (a basis point is one-hundredth of a percentage point) over the previous quarter. And, it had improved further by another 200 bps in July and August.

In July, Flipkart acquired online fashion retailer Jabong for $70 million to boost its online fashion business, housed in Myntra, over $1 billion revenues, widening its gap with closest rival Amazon.

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