US-based offline and online retailer store Walmart Inc is in early talks with the E-commerce Giant Flipkart India Private Ltd for an equity partnership. In the advanced talks, Walmart is going to invest as much as $1 billion into Flipkart.
The move is taken as a joint battle against their common rival Amazon. Both the firms want to gain more footing in the market. Amazon one of the top online retailer expands it services in rural America which offers competitive deals and shipping to homes of the customers.
Walmart is also looking at expanding its business in India by opening more stores and even as it explores an online presence in the country. Flipkart is one of the largest e-commerce retailers in India but has a competition with Amazon which steps up its investment in the country.
Earlier in the month of July, the Chief Executive Officer Jeff Bezos announced that they are going to invest $5billion in the country to gain customers in the fast growing market. The deal that had made by Flipkart and Walmart would be beneficial for both.
“We are well capitalized to invest in technology, supply chain and to get to the next level of growth. One thing we should remember is that Flipkart has been in the top five companies globally to raise private capital. So that amount of capital is very meaningful.We have been very diligent and focused on spending that capital. Our complete focus is on growing the business, innovating for our customer and capital is not in my focus area,” Flipkart co-founder and Chief Executive Officer Binny Bansal said in an interview last week.
After China and the United States, India is the largest online retail market. Both Amazon and Walmart are trying to make their mark in the country. Walmart has 11,527 stores across 28 countries presently and employs around 2.3 million people. It is recorded that the Walmart revenue was about $482 billion last year.
The world’s largest retailer Walmart may be worried about its declining online sales in the US, but Amazon continues to grow impressively both in US and India.