(Reuters) - Amazon.com Inc may make a rival offer to buy Indian e-commerce firm Flipkart, which is in tie-up talks with Walmart Inc, local media reported, as the two U.S. retail giants jostle for dominance in India’s booming online industry.

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Amazon held early exploratory talks to buy control of Indian rival Flipkart but a deal with Walmart is more likely, daily newspaper Mint said on Wednesday, citing people with knowledge of the matter.

One person familiar with the matter told Reuters that the probability of a deal with Amazon was low, and that any such deal could spark monopoly concerns as Flipkart and Amazon dominate India’s e-commerce market. The person declined to be identified as discussions were private.

Amazon declined to comment when contacted by Reuters. Flipkart and Walmart did not respond to requests for comment.

Walmart is in talks to buy over 40 percent of Flipkart in potentially one of its biggest overseas deals, Reuters reported in February. A deal would give the world’s largest brick-and-mortar retailer access to an e-commerce market that Morgan Stanley estimated to be worth $200 billion in a decade’s time.

The deal would also represent a direct challenge to Amazon in Asia’s third-largest economy. Amazon has committed to investing $5 billion in India as it expands into online grocery delivery.

Walmart will buy a majority stake in Flipkart through a mix of primary and secondary share purchases in a deal that could value the Indian firm at $21 billion, Mint reported.

Flipkart, founded by former Amazon employees Sachin Bansal and Binny Bansal in 2007, controls nearly 40 percent of India’s online retail market, ahead of Amazon, showed estimates by researcher Forrester.

Like Amazon founder Jeff Bezos, the pair began by selling books and diversified rapidly, including by selling smartphones through exclusive flash sales. Flipkart now competes with Amazon on almost all product categories.

Flipkart’s success has attracted a bevy of deep-pocketed and tech-savvy investors including U.S. hedge fund Tiger Global Management LLC, online marketplace eBay Inc and software maker Microsoft Corp, as well as Chinese technology firm Tencent Holdings Ltd.

It was valued at around $12 billion when Japan’s SoftBank Group Corp’s Vision Fund bought roughly a fifth of the firm last year for $2.5 billion.