Softbank has rallied back on its dreams of acquiring a substantial stake in e-commerce major Flipkart. On Thursday, Softbank Vision Fund, the $100-billion technology-focused fund floated by bank founder Masayoshi Son, invested an undisclosed but significant amount in India's largest e-commerce marketplace Flipkart, making it one of the largest investors in the company, according to media reports.

As a result, SoftBank will now become the largest shareholder in Flipkart, just days after Snapdeal founders decided to terminate merger talks with the Bangalore-based company.

A report by news agency Reuters on August 1 had hinted that Softbank plans to invest about $2 billion through its Vision Fund.

The investment estimated to be over $2-2.5 billion will be a mix of primary and secondary capital from SoftBank's Vision Fund, and is part of the same fundraise that saw Tencent, eBay and Microsoft invest $1.4 billion in April. It will be made at the same $11.6 billion valuation as the earlier round.

Flipkart claimed that with this investment from Softbank Vision Fund, it will have an excess of $4 billion in cash on its balance sheet which will enable it to make further financial investments to consolidate its pole position in the e-commerce market, the Business Standard reported on Thursday.

SoftBank has an India portfolio spanning e-commerce, ride sharing, digital payments, hospitality, clean energy and telecommunications, which is valued at over $6 billion.

"This is a monumental deal for Flipkart and India. Very few economies globally attract such overwhelming interest from top-tier investors. We're excited to welcome the Vision Fund as a long-term partner as we continue to build our business with a focus on serving the needs of all Indians," said Binny Bansal and Sachin Bansal, co-founders of Flipkart.

Financial portal Moneycontrol.com speculated on Thursday that the upcoming Diwali will see a lot of discounts from both Amazon and Flipkart.

India enjoys a thriving Internet market with close to 500 million Internet users. As per market research, the Indian e-commerce market is expected to grow at a five-year compounded annual growth rate in excess of 30 percent.