Founded in 2010 by Wharton alumni Kunal Bahl and IIT-Delhi graduate Rohit Bansal, Snapdeal is India’s largest online marketplace in terms of sellers transacting on its platform.

In an eBay blog post, the company explained the business decision, which included the announcement that it was selling a portion of its Snapdeal investment – but it did not specify how much.

But due to high potential in Indian e-commerce, Snapdeal’s valuation has grown to $5 billion.

E-commerce company eBay Inc has sold a portion of its stake in Indian online marketplace Snapdeal, and will focus on boosting its own business in the country, it said on Tuesday.

The company also did not disclose how much it raised in fourth, or D round from e-Bay, the US-based leading e-commerce player, in April 2013.

Like its rivals, Snapdeal sees the majority of its transactions on smartphones and mobile devices.

India’s etail market is worth $2.3 billion in annual sales, or just 0.4 per cent of total retail sales, according to Technopak, a consultancy, but this is forecast to rise to roughly $31 billion by 2020.

“This investment in Snapdeal enhances our exposure to India’s burgeoning ecommerce industry”, said Alibaba. Ebay said it was able to realise a significant return on its early investment in Snapdeal, which has grown strongly in the two years since eBay first acquired the stake. “Going forward we will focus on accelerating eBay’s presence in India, and empowering customers through technology”, the San Jose, California-headquartered ecommerce company said in a statement.

He added, with global leaders like Alibaba, Foxconn and SoftBank supporting the company, its efforts towards building India ” s most impactful digital commerce ecosystem will be propelled further, enabling it to contribute towards creating a Digital India.

Many had speculated that eBay would go on to acquire Snapdeal outright, rather than striving to compete with the platform in the lucrative India region, but that seems unlikely now in light of today’s news.