Walmart To Inject $600 Mn Into Flipkart During A Billion Dollar Funding Round

Walmart-backed ecommerce major Flipkart is reportedly looking to raise a fresh funding of $1 Bn, with the US retail giant committing $600 Mn.

This fresh infusion will likely value Flipkart at about 5-10% premium to its last valuation of $33 Bn, ET reported, citing sources.

Besides Walmart and other existing shareholders, the Bengaluru-based ecommerce major’s round will also see new investors joining the cap table, the report said.

Flipkart confirmed Walmart’s infusion of $600 Mn in the company but said that the rest is speculative. Walmart also informed about its fresh infusion in a regulatory filing.

Walmart acquired 77% stake in Flipkart in 2018 for $16 Bn, valuing the company at $22 Bn. After the separation of PhonePe from the group last year, Flipkart’s valuation stood at $33 Bn.

Recently, during the six months ended July 31, 2023, Walmart spent $3.5 Bn to acquire Flipkart shares from non-controlling stakeholders, including Tiger Global and Accel.

Flipkart also plays a major role in the US-based ecommerce giant’s earnings performance each quarter. Walmart said in its recent Q3 2023 earnings statement that its India operations were impacted due to the late arrival of the festive season, and as the Flipkart Big Billion Days sales shifted from Q3 last year to Q4 this year.

“The timing of Flipkart’s Big Billion Days pressured International sales growth, as the event moved from Q3 last year to Q4 last year. So we expect the timing to be a benefit to Q4’s growth rate for the segment,” Walmart had said.

Meanwhile, Flipkart continues to incur losses. Flipkart India, the B2B arm of the company, saw its standalone net loss widen over 42% year-on-year to INR 4,845.7 Cr in FY23 while its operating revenue increased 9.7% to INR 55,923.9 Cr.

In FY22, Flipkart Internet, the ecommerce giant’s marketplace arm, also reported widened losses.

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