1. News
March 23, 2018

Walmart plans to invest in India’s e-commerce to challenge Amazon

Walmart is investing in Indian technology start-ups and talent to support its proposed deal to buy a stake in online retailer Flipkart.

Walmart is investing in Indian technology start-ups and talent to support its proposed deal to buy a stake in online retailer Flipkart.

The US retailer is looking to acquire between three and five start-ups in India over the next year, a move that will step up its retail game plan in this Asian market.

In a bid to challenge rival Amazon on the global and Indian retail turf, Walmart is negotiating to acquire a majority stake in Bengaluru-based Flipkart.

Walmart reportedly plans to invest $7bn in the planned tie-up with Flipkart, with which it expects to strengthen its footprint in the food sector, where it lags far behind Amazon.

“Walmart reportedly plans to invest $7bn in the planned tie-up with Flipkart, with which it expects to strengthen its footprint in the food sector, where it lags far behind Amazon.”

The company will also set up back-end food and grocery infrastructure to tap India’s online and offline markets.

A major portion of Walmart’s proposed investment in Flipkart will be spent on developing infrastructure such as food parks, cold chain, sorting and grading facilities, collection centres.

As a segment, food and grocery represent about 60% of India’s $600bn retail market. Despite having a huge potential, organised food and grocery retail makes up less than $10bn.

The supermarket chain has made significant investments and acquisitions to cement its e-commerce strategy. It acquired online retailer Jet.com for $3.3bn in 2016, and a 5% share in China’s second-largest e-commerce firm JD.com during the same year.