Myntra lifting Walmart’s Flipkart business, US retailer says

Fashion e-commerce platform Myntra’s performance is lifting the profile of Walmart’s Flipkart business, a top executive at the US retailing giant said in the company’s earnings call this week.

The fashion business has reported profits in the past two quarters, a top executive handling Walmart’s international operations said.

“We’ve seen Myntra get to Ebitda (earnings before interest, taxes, depreciation, and amortization) positive for the last two quarters. We’ve seen a growth in some premiumization and all of that is lifting the profile of the Flipkart business,” said Kathryn J. McLay, president and chief executive officer at Walmart International. Ebitda is a measure of profitability.

McLay said Walmart is also exploring the right time to launch an initial public offering (IPO) for Flipkart, while adding that the retailing giant is “excited” about the India market.

“They are on track to the growth trajectory that we had them on and we are looking and exploring when will be the right time to IPO that business, but now there’s the strong growth in Flipkart and in PhonePe and we’re excited about the India market,” McLay added.

Walmart-owned e-commerce firm Flipkart is actively exploring options to domicile in India from Singapore, Indian media had reported this week.

Flipkart Pvt. Ltd, the country’s biggest consumer internet company, was valued at $35 billion as on 31 January, based on equity transactions effected by the company’s US parent, Walmart.

In 2022, when payments firm PhonePe split from Flipkart group and shifted its domicile status home from Singapore, Walmart had paid about $1 billion in local taxes.

Double-digit growth at Flipkart

Flipkart, which forms part of Walmart’s international business, marked double-digit growth in sales and profit, a top Walmart executive said during the earnings call.

“We continue to deliver strong results with double-digit growth in sales and profit, lifting our company growth rates. Strength was broad based led by Walmex, China and Flipkart,” C. Douglas McMillon, president, chief executive officer and director at Walmart.

Walmart’s international business led the retailing giant’s sales growth, another top executive said in the investor conference call.

“International led the enterprise with constant currency sales growth of 10.7%, reflecting strength in Walmex, China and Flipkart,” John David Rainey, chief financial officer and executive vice-president at Walmart, Inc. said.

“International e-commerce sales were up 19% as we continue to expand our capabilities,” Rainey said, adding that in India, “Flipkart same-day delivery became available to millions more customers as they expanded the offering to 20 cities.”

“For marketplace, within international, all markets grew double-digits led by Flipkart and Walmex, reflecting the strength we’re experiencing across markets,” Rainey added.

Walmart reported a 10.7% growth in international net sales in constant currency terms during the quarter to April, led by Walmex, China and Flipkart.

E-commerce sales rose 19%, led by store fulfilled pickup and delivery and marketplace, while its advertising business grew 27%, led by Flipkart and Walmex.

Operating income in constant currency terms jumped 27.2%, “with strength across markets and benefiting from lower losses in e-commerce, the company said.

Walmart shares ended 7% higher on Thursday, the biggest one-day gain since March 2020. The stock has risen 22% year-to-date, outpacing the 11% increase in the broader S&P 500 Index.