The logo of India's largest online marketplace Flipkart is seen on a building in Bengaluru, India, April 22, 2015.Reuters

China's Alibaba Group is reportedly looking to buy stake in domestic e-commerce major Flipkart as part of its plans to increase its presence in India.

The firms have begun talks and the deal likely depends on "Flipkart's willingness" to offer a stake for a discount on its current valuation of $15 billion, sources familiar with matter told Mint.

Alibaba has already backed other e-commerce players such as Paytm and Snapdeal. If the firm strikes a deal with Flipkart, it would emerge as one of the top investors in the Indian e-commerce space, alongside Tiger Global Management and Japan's SoftBank Group.

The Chinese firm is also in discussions to raise its stake in Snapdeal. However, it "wants" a discount on the firm's current valuation of $6.5 billion to strike the deal.

As fund raising has become difficult for the domestic e-commerce majors at their current valuations, both Flipkart and Snapdeal had to approach Alibaba Group for cash, sources told the daily.

Despite having sufficient funds to meet their current burn rates for 12-15 months, both the firms "need to raise money this year to refill their fast-emptying vaults," sources added.

Flipkart's losses escalated to Rs.2,000 crore in the fiscal year ending March 2015, up nearly 180% compared to Rs 715 crore in the previous year, according to the company's filing to Registrar of Companies.

Indian Internet companies have started witnessing "stagnation or decline" in their valuations as fund raising activity slowed from the "unprecedented" growth in the first half of 2015. The firms have also faced severe criticism for their expensive valuations.

After investing billions of dollars in the past two years, venture capitalists (VCs) are now taking a cautious approach on Indian start-ups as their valuations soar and losses escalate.

Investment by venture capital firms in the country fell $600 million to $1.51 billion in October-December 2015 against $2.12 billion in the same period in 2014, according to a report by CB Insights and KPMG International.