A day after announcing $ 16 billion investment in India’s largest online retailer Flipkart, Walmart Inc on Thursday said it will continue to grow its wholesale cash-and-carry business, adding 50 new stores in the next four-five years.
“We currently have 21 stores and plan to open 50 stores in 4 to 5 years. Plans are on track,” Walmart India President and CEO Krish Iyer said
Walmart Chief Executive Doug McMillon said Flipkart, in which the US retailer is acquiring 77 % stake, would continue to operate as a separate board-managed company with co-founder Binny Bansal as the CEO.
Flipkart gives Walmart an online presence which had been handicapped by India’s retail policy that does not allow overseas companies to sell directly to consumers (except in wholesale cash-and-carry segment).
Flipkart and Amazon operate as e-commerce marketplaces -- a segment where 100 % foreign direct investment (FDI) is allowed.
“ We have a pipeline of 20 stores and we expect to open 5 stores in the current year and then pick up pace and eventually. ,” Iyer said.
Walmart currently operates in 9 states and 19 cities and the future expansion is focused on more or less the same geographies.
At its 21 Best Price wholesale stores, Walmart sells everything from fast-moving consumer goods to furniture to other retailers and institutions.
Analysts believe that Walmart’s investment in Flipkart, whose 34 % market share in India’s online sales is ahead of rival Amazon’s 27 %, will boost the Indian e-commerce company’s logistical operations.
Walmart is buying 77 % of Flipkart from existing shareholders, including Japan’s SoftBank, for $ 14 billion and investing $ 2bn of fresh equity.
Walmart India is a wholly-owned subsidiary of Walmart Stores Inc and offers close to 5,000 items through its cash-and-carry wholesale format.
