Walmart readies another $2.5 billion investment in India’s e-commerce and payments
Walmart is making another big bet on India’s booming digital economy
The world’s largest retailer is injecting another $2.5 billion into its India business, as the company looks to accelerate its growth in the country’s burgeoning e-commerce and payments market.
Walmart’s investment will come in the form of equity investments and debt financing for Flipkart Group, the Indian e-commerce giant in which the American retailer holds a 77% stake.
The move comes just months after Walmart pumped $1 billion into Flipkart, and takes the total amount of money the US company has invested in the Indian firm to over $5 billion.
India is a key market for Walmart, which is looking to offset slowing growth in its home market with expansion in other parts of the world.
“We’re committed to accelerating our digital capabilities in India, including through additional investments in Flipkart,” said Doug McMillon, Walmart’s president and CEO, in a statement.
“This funding will help Flipkart continue to reinvent commerce in India through technology,” he added.
Founded in 2007, Flipkart has become one of the most dominant players in India’s e-commerce market, which is forecast to be worth $200 billion by 2026.
The company’s main rival is Amazon, which has committed to investing $5 billion in India.
Walmart’s latest investment will be used to help Flipkart expand its product offerings, build its payments business, and grow its Grofers grocery business.
It will also help the company to develop new technologies, including an AI-based assistant for Indian shoppers and a smart assistant for Walmart stores in the US.
The move comes as India’s digital economy is booming, with millions of first-time internet users coming online every year.
According to a recent report by the Boston Consulting Group, India is on track to have 700 million digital consumers by 2025, up from 450 million in 2018.
Walmart’s investment in Flipkart is part of its wider strategy to tap into this growth.
In 2016, the company acquired a majority stake in the Indian e-commerce firm, in a deal that valued it at $16 billion.
Last year, Walmart also invested in Indian online payments company PhonePe, and acquired a majority stake in the country’s largest online grocery firm, BigBasket.
The company plans to use its investments in these companies to create a “one-stop-shop” for Indian shoppers, who will be able to buy everything from groceries to electronics on one platform.
The move is also part of Walmart’s larger effort to take on Amazon in the global e-commerce market.
The company has been investing heavily in its online business in recent years, and now has a presence in 10 countries. It is also expanding its network of physical stores, and now has more than 11,000 locations around the world.