Alejandro Arrieche
The largest retailer in the United States, Walmart, is reportedly investing more money into its businesses in India as competition to maintain leadership in this giant Asian market continues to attract big money from the West.
According to a report from the Economic Times published earlier today, Walmart would be seeking to buy the stakes of Accel Partners and Tiger Global in its Indian e-commerce company Flipkart.
The total amount to be invested would be approximately $1.5 billion according to the sources cited by the media outlet and they correspond to a 5% stake in the firm. If the transaction is completed, Walmart would own around 77% of Flipkart.
For both Accel and Tiger, their investment in Flipkart has been wildly successful as the two private equity firms bought their stakes quite early in 2009, only two years after the e-commerce platform was founded by Sachin Bansal and Binny Bansal.
Other companies that have invested in Flipkart include SoftBank, Tencent Holdings, and Microsoft (MSFT).
Walmart bought its majority stake in Flipkart in 2018 for around $16 billion after massively missing the e-commerce boat in the United States in the hands of Amazon. Since then, it has been pouring money into the Asian country to make sure its subsidiary remains the leading force in this market.
According to a report from Reuters published in April last year, Flipkart could go public in the United States this year. Back then, the firm was targeting a valuation ranging from $60 to $70 billion. This would result in gross earnings of at least $30 billion for Walmart from its stake in the Indian firm.
It is unclear if those plans have changed given the overall drop that equities have suffered around the world amid the hawkish actions taken by central banks to keep inflation in check.
However, it is clear that Walmart is not being deterred by these headwinds to increase its bet on the Indian e-commerce market by amassing an even larger stake in Flipkart.
Flipkart Maintains its Leadership in the Growing Indian E-Commerce Market
According to data from the India Brand Equity Foundation, the e-commerce market in the country could become the second largest in the world by 2034. As of 2025, revenues from this sector are expected to grow to $111.4 billion – nearly three times more than the figure reported in 2020.
Meanwhile, various reports indicate that Flipkart’s market share in the e-commerce sector in India ranges between 30% and 40% by gross merchandise volumes (GMVs). Amazon (AMZN) has been working hard to increase its footprint in the market but has encountered many setbacks including a lost bid to purchase Reliance – another large retail company in the country.
Just a few days ago, the company founded by Jeff Bezos launched an air freight service in the country to strengthen the backend infrastructure of retailers. The company has reportedly poured $9 billion into India including investments made by its cloud unit AWS to build data centers and expand its regional reach.
Walmart is Also Preparing to Pour Up to $2 Billion into PhonePe
In addition to this upcoming Flipkart investment, Walmart (WMT) is also deploying another $1 billion to increase its stake in PhonePe, a digital payments company that came out of Flipkart and that was recently valued at $12 billion during a funding round in which both the American retailer and the private equity firm General Atlantic participated.
Walmart could reportedly increase its stake in PhonePe by buying shares from existing stockholders. These transactions could increase the amount invested into the tech firm to as much as $2 billion.
Most of these sales will come from Flipkart’s employees who received stock options of PhonePe and who have the alternative to either hold on to them or cash them out by selling them to a third party – Walmart or General Atlantic most probably.
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This article was written for Business 2 Community by Alejandro Arrieche.
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