10 May 2018•Update: 10 May 2018
By Shuriah Niazi
NEW DELHI, India
Walmart’s deal to acquire Indian online giant Flipkart will open up new opportunities for Indian start-ups, according to analysts.
“This shows that international companies have faith in the Indian market and they are looking for opportunities to invest,” Aditya Manya, vice chairman and president of investment firm Kalpataru Multiplier Ltd., told Anadolu Agency.
U.S. retail giant Walmart on Wednesday announced the acquisition of a 77 percent stake in Flipkart for about $16 billion, in the world’s largest e-commerce deal to date.
The controlling stake will set Walmart, the largest retailer in the world, in a more prominent position to battle its rival Amazon in the worldwide e-commerce space.
Krish Iyer, Walmart India’s president and CEO, on Thursday told Press Trust of India: “We currently have 21 stores and plan to open 50 stores in four to five years. Plans are on track.”
But some traders in India are opposed to the deal, fearing its effect on competition.
Praveen Khandelwal, secretary general of the Confederation of All India Traders (CAIT), told Anadolu Agency: “We need a regulatory authority in India to regulate e-commerce business. The deal will affect India’s retail business in the long run.”
Walmart’s previous attempt to enter India’s street-level stores failed with a partnership with Bharti enterprises in 2007.
India is one of the world’s fastest growing online retail markets, and Walmart’s 77 percent investment in Flipkart ensures its presence in a market which is set to hit $73 billion a year by 2022, with an increase in smartphone users.
Flipkart, founded in 2007, sold $4.6 billion worth of goods in the fiscal year ending in March, more than a 50 percent increase from the previous year.
Home to 1.3 billion people, India has seen the size of its middle class surge.
Analysts believe more than 500 million Indians will be online by the end of 2018 – Flipkart said that its delivery business, eKart, serves more than 800 Indian cities and makes some 500,000 deliveries every day.
