Walmart looks to global growth in India, to help double foreign sales to USD$200B by 2028, to show investors. EkaLore has looked at how Walmart, Amazon, Google, and Indian enterprises like Reliance are investing in all parts of Indian retail for growth. The USA-based enterprises are Alien Invaders bringing capital, technology, and different business models to India. Indian colossal tech enterprises, and conglomerates like Reliance, are responding to competition with new service networks, technology-based solutions, and sheer volumes of feet-on-the-ground.
Flipkart is set to continue competing with Amazon, and others, across many Indian marketplaces. In addition to a competitive selling marketplace Flipkart continues to expand services such as travel, financial services, and prescriptions.
Walmart has acknowledged Flipkart’s value:
rapid agility in markets,
innovative approaches in less developed markets,
seller relationship building for ecommerce,
use of customer data as a guide to behavior, and
processes to improve customer service.
Flipkart’s broad geographic marketplace presence in India covers many rural areas and smaller cities. Amazon has been concentrating, like other global marketplaces, on highly dense urban centers in India. In the fiscal quarter ended April 30th Flipkart grew consumer counts with sales growth by double-digit percentages year-over-year. In a specialized area Flipkart’s online advertising revenues grew by 50%.
Walmart looks to use Flipkart’s technology stack and market approaches in Africa with partner Masskart. In Spanish-speaking Americas, PhonePE is collaborating with Walmart’s Mexican subsidiary on Cashi’s payments systems and interfaces.
Walmart, along with co-investors like Softbank, have been investing in online merchant Flipkart with a valuation achieved at USD$35-38B. Walmart has continued to invest, even after the last large fund raising round in mid-2021 for USD$37.6B, and has sought more ownership and control. Ownership interests in Flipkart included Tiger Global (a hedge fund), Accel (venture fund), GIC, and Canada’s Pension Plan Investment Board. From the 77% Walmart owned from 2018 Walmart now controls about 80% of Flipkart. Softbank was an original investor in Flipkart and then sold its 20% stake to Walmart in 2018. Softbank Investment Advisors Vision Fund 2 re-invested in the mid-2021 investment round. Other investors in 2021 included DisruptAD, Qatar Investment Authority, Khazanah Nasional Berhad, and Antara Capital (Blackstone Group). Prior investors Franklin-Templeton, Oryx Group, and Antara have now completed selling their stakes. The Founders’ stakes, with a small purchase by Tencent, have largely been sold. Some investor exit rights were triggered by Walmart’s purchases of other investors’ interests. Other smaller investors still include Microsoft and CPP Investments. Walmart’s control of Flipkart points to an eventual objective of a separate float to realize investment gains and reward its partners. An alternate strategy depending on market outcomes would be to complete the buyout at a level about USD$50B valuation representing a 40%+ gain for partners in the mid-2021 round.
For more about Walmart, Reliance, Google, Meta, and Amazon in India see http://www.ekalore.com/india-business
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