Walmart’s push to take its multi-billion dollar investment in Flipkart public is on hold as the Russian invasion of Ukraine has dampened investor appetites for an initial public offering (IPO), according to Reuters, who cited sources close to matter.
A Flipkart IPO is now expected to be in early 2023, according to Walmart officials.
Walmart bet big on Indian commerce in 2018 acquiring an 80% stake in Flipkart for roughly $16 billion. Walmart has since sold off businesses in the United Kingdom, Japan, Brazil and South Africa. Walmart also dissolved Jet.com into its U.S. business.
Walmart CEO Doug McMillon said in 2018 that not everyone would understand the big investment but he felt it had to be made given the immense growth opportunities in India and groundwork Flipkart had already made. McMillon said Flipkart would be important to Walmart in the long term. Judith McKenna, CEO of Walmart International, has said the Flipkart deal was ripe with possibilities and there were intentions to take the company public within four years.
By 2019, Walmart valued Flipkart at $24.9 billion and by 2020 Walmart rolled its Indian wholesale business into Flipkart. Also in 2020, Walmart invested another $1.2 billion into the diversified Flipkart venture. In July 2022, Flipkart raised $3.6 billion in new capital for continued investment and expansion. Walmart valued Flipkart at $37.6 billion following that 2021 capital infusion. A public offering goal was set when the valuation reached $50 billion.
The latest Flipkart valuation is pegged between $60 billion and $70 billion, according to Reuters, who again cited persons close to the situation. In December, Walmart Chief Financial Officer Brett Biggs told analysts that Flipkart’s business was performing well but gave no timeline for an IPO.
Flipkart is in the midst of growing Cleartrip, a travel booking platform it acquired last year, and the more recently launched a health application to sell medicine and health services to the vast Indian consumer base.
Walmart shares (NYSE: WMT) traded at an all-time high on Thursday (April 7). The shares closed at $156.54, up $1.55. Shares set an intra-day high price of $157.54 before retreating in the final hour of trading.