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June 8, 2024

Walmart’s IPO Plans for Flipkart and PhonePe: A Look Ahead

FILE PHOTO: Shopping trolley is seen in front of Flipkart logo in this illustration, July 24, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

Walmart is strategically planning the initial public offerings (IPOs) of its Indian subsidiaries, Flipkart and PhonePe, with timelines extending over the next few years, according to a company executive. Dan Bartlett, Walmart’s Executive Vice President for Corporate Affairs, disclosed these details during the company’s shareholder meeting near its headquarters in Bentonville, Arkansas.

Prioritizing PhonePe Over Flipkart

Despite Flipkart being the more established entity, Walmart is considering an IPO for PhonePe first. “This is something we’re looking at over the next couple of years,” Bartlett remarked. He highlighted the significant growth and potential of PhonePe in India’s digital payments landscape.

PhonePe: A Leader in India’s Digital Payments

PhonePe, one of India’s largest payment platforms, is deeply integrated with the Unified Payments Interface (UPI). UPI is a revolutionary system that facilitates instant money transfers across multiple banks without needing to disclose account details. This seamless integration has played a pivotal role in PhonePe’s success.

Bartlett emphasized the extensive preparations needed before taking PhonePe public. “There’s a lot of processes that have to be put in place before we go public,” he said, noting the consideration of listing on the Indian exchange versus others as a crucial decision.

Flipkart and PhonePe: Future $100 Billion Businesses

A year ago, Walmart’s Chief Financial Officer projected that both Flipkart and PhonePe could evolve into $100 billion businesses, driven by robust growth. These businesses are seen as critical to Walmart’s goal of doubling its gross merchandise volume in foreign markets to $200 billion within five years.

Remarkable Growth in Financial Year 2023

PhonePe’s consolidated revenue for the financial year 2023 soared by 77%, reflecting the burgeoning digital payments market in India. As of March 2023, PhonePe boasted over 490 million registered users and captured nearly 51% of the transaction value on India’s UPI platform. This dominance underscores PhonePe’s vital role in the Indian financial ecosystem.

Strategic Implications for Walmart

The potential IPOs of Flipkart and PhonePe signify Walmart’s broader strategy to capitalize on the growing digital economy in India. By prioritizing PhonePe’s public offering, Walmart aims to leverage the rapid adoption of digital payments in the country, setting a strong foundation for long-term growth and profitability in a key international market.

As Walmart navigates the complex processes involved in preparing these entities for public listings, the decisions made will be pivotal in shaping the company’s future in one of the world’s most dynamic markets. The eventual IPOs will not only unlock significant value for Walmart but also reinforce its commitment to innovation and expansion in the global retail and digital payments sectors.

Read more Business related news on R9 News
Jhumpa Lahiri

Jhumpa Lahiri

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