Two of India’s biggest e-commerce retailers — Flipkart and Myntra — are apparently in talks to merge, a proposal being pushed by their common investors Accel Partners and Tiger Global. The Times of India reported this morning that Flipkart has already approached Myntra, and a decision on whether to go with the merger would be taken in two weeks.

Flipkart has been looking to expand in newer categories such as fashion retailing, its co-founder Binny Bansal had told me recently. By merging with Myntra, Filpkart can add another category, and also widen the gap with everybody else even further. Flipkart is aiming to achieve $1 billion in gross merchandise value by next year.

Flipkart has raised $540 million so far from investors including Accel, Tiger, Dragoneer Investment Group and Morgan Stanley Investment Management. In October last year, it raised $160 million, taking its Series E funding to be the largest ever by any Indian Internet company.

India’s nearly $3.1 billion e-commerce market (excluding online travel industry) is dwarfed in size by China’s nearly $200 billion market for online sales, but it’s expected to grow by over seven times to $22 billion in five years, according to a CLSA report published in November 2013.

Myntra, one of India’s biggest online clothing and footwear retailers, has been in discussions with several investors to raise around $50 million, sources are telling us. These discussions included a proposal to merge with Flipkart or acquire another e-commerce company to gain certain size, but nothing has been finalized yet, the source added.

Clearly, the signs of consolidation are very visible in India’s e-commerce sector. An intense battle for market share is being fought among Flipkart, eBay-backed Snapdeal and Amazon. A lot is riding for investors backing Flipkart, so any proposals that help it garner a larger share of the market cannot be ruled out.

We have reached out to Flipkart, Myntra and their investors for reactions and we will update after hearing from them.