Walmart India cuts losses by 27% in FY17

Walmart India has claimed to have narrowed its losses by almost 27% during FY17 compared to the 12 months in the previous fiscal, according to its financials with the Ministry of Corporate Affairs (MCA) sourced from data-tracking platform Tofler.

The company posted a loss of Rs 75 crore for FY17. It also witnessed a 10% revenue growth for the fiscal ending March 2017 as compared to previous 12 months.

The company registered total revenues worth approximately Rs 3,641 crore of which Rs 1,921 crore was contributed by food sales and the Rs 979 crore was by FMCG, among others. Total expenses clocked by the company during the same period come up to Rs 3,716 crore.

Walmart India, which owns and operates 21 Best Price Modern Wholesale stores had to shut operations of a store in Vijayawada as a result of a fire in August 2016. But the company “is strongly committed to reopening the said store,” read the financials of Walmart India, with plans of adding a pipeline of new stores to expand footprint in the coming years. Store expansion was put on hold until August 2015. Other companies operating in this space are Metro, Reliance, and Bookers.

Walmart India’s plans to expand its footprint comes as its holding company Walmart is very close to buying into 75% of India’s largest online retailer Flipkart — a deal which could possibly include a plan to open a chain of retail stores across the country.

Walmart cannot directly open retail stores in India because of restrictions on overseas investments in multi-brand retail.

Walmart had previously partnered with Bharti Enterprises to maneuver around India’s foreign direct investment rules. In 2013, Walmart agreed to buy Bharti’s 50% in their wholesale business that operated Best Price Modern Wholesale stores and terminated franchise and supply agreements related to almost 200 EasyDay retail stores.

The US retail giant steered clear of any Indian partnerships until 2016 when it began investment discussions with Flipkart which did not materialise.

Walmart’s foray into the Indian e-commerce sector via its potential acquisition of Flipkart would not bring its long-time rivalry with Amazon to Indian battlegrounds, but will also give a boost to online grocery considering the presence of Walmart India’s cash-and-carry stores.