Explained: Why Walmart is bullish on Flipkart, PhonePe’s growth in India
At an investor conference, Walmart’s chief financial officer John David Rainey said both businesses could be potentially worth $100 billion, buoyed by strong growth.
In Short
- Walmart sees $100 billion potential for Flipkart, PhonePe
- US retail giant bullish on rapid e-commerce, digital payments growth in India
- Walmart sees India as a marketplace with significant growth opportunity
US retail giant Walmart has its eyes set on rapid expansion in India through its entities, e-commerce behemoth Flipkart and digital payments firm PhonePe.
At an investor conference, Walmart’s chief financial officer John David Rainey said both businesses could be potentially worth $100 billion, buoyed by strong growth. “It is not crazy to think that both those businesses could be $100 billion businesses in the future," Rainey said.
While Walmart does not report individual sales figures for Flipkart and PhonePe, its executives have singled out the two businesses as key drivers in meeting its target of doubling the gross merchandise volume (GMV) it sells in foreign markets to $200 billion in the next five years.
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Significant opportunity in India
It is no secret that many major global brands are aiming to grab a bigger share of India’s rapidly growing marketplace across sectors. Walmart is among the behemoths that plan to capitalise on the growing digital penetration in the country – be it online shopping or digital payments.
Walmart’s international chief previously called India’s 1.4 billion-plus population a “significant” opportunity for the retailer.
The global retailer remains optimistic about Flipkart as the e-commerce firm generated double-digit sales growth in the recent quarter ended April 30, supported by new shoppers in some cities and a 50 per cent jump in ad sales.
Moreover, Flipkart was valued at more than $40 billion in 2022 and considers itself among one of India’s most valuable start-ups.
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Meanwhile, Walmart also said PhonePe’s performance in India has been “really impressive” after it hit an annualised payment value of $1 trillion led by the Unified Payments Interface (UPI).
Data from the National Payments Corporation of India showed PhonePe controlled 46 per cent of the payments market in December, and has 400 million registered users.
It got a further boost in March 2023 when Walmart gave it a $200 million boost at a pre-money valuation of $12 billion, cementing its position as India’s most valuable payments start-up.
Also Read | PhonePe gets UPI Lite support, now lets users make payments without UPI PIN