Xiaomi Inc., China’s largest mobile-phone seller by shipments, is planning to close a round of private equity investment by the end of this year, Bloomberg reported Thursday, citing people with direct knowledge of the matter.

Xiaomi is seeking a valuation of more than $40 billion, Forbes had reported on Oct. 31. If the four-year old smartphone maker is successful in achieving the desired valuation, it would be larger than Sony Corp. and Lenovo Group Ltd. put together, in terms of market capitalization, making it the world’s most valuable privately-held technology company.

As interest intensifies in Xiaomi’s blistering growth -- it’s set to sell over 60 million handsets this year in a 10-fold increase from 2011 when it first sold its own handsets -- media reports have also speculated about a likely initial public offer. And, if Xiaomi gets the valuation it’s looking for, its value will jump four-fold from last August, when an undisclosed investment is said to have valued the company at $10 billion, according to Forbes.

Existing investors such as Russian billionaire Yuri Milner's DST Global, Singapore’s Temasek Holdings Private Ltd., Morningside Ventures and IDG Capital, could all potentially be investors in the latest round, Bloomberg said in a separate report on Nov. 4, adding that these details aren’t confirmed yet as the talks are private.

Xiaomi founder Lei Jun is personally leading the effort to close the funding round, which will help him expand well beyond China and add products such as Internet television, Bloomberg reported on Thursday.