Walmart-owned Flipkart may need to seek additional funding in 2023 due to a lack of cash for operations. The company has been investing heavily in its operations and facing increased competition.
What happened: Flipkart, an Indian e-commerce company, may need to seek additional funding in 2023 as it is running out of cash for operations. The company, which was acquired by Walmart in a $16 billion deal, has already used up much of the $3.2 billion in net cash it raised in 2021 from investors.
Why it matters: Flipkart is one of the leading e-commerce companies in India employing more than 30,000. The company's acquisition by Walmart, one of the largest retail giants in the world, has also made it a significant player in the global e-commerce market.
Between the lines: Flipkart has been investing heavily in its various subsidiaries and business ventures in recent years. According to a filing to the Registrar of Companies,
Flipkart infused: $589 million in Flipkart India Pvt.
$353 million in the business-to-consumer unit Flipkart Internet Pvt.
$412 million in Instakart, which holds the logistics EKart business of Flipkart.
$66 million in Myntra Designs and Myntra Jabong India.
$600 million in inorganic growth with investments in companies like Ninjacart and ANS
Additional $300 million in Flipkart India and $70 million in Ekart.
By the numbers: Flipkart's total assets grew to INR 98,377.5 crore ($13.5 billion) at the end of FY22, up from INR 67,432.1 crore ($9.3 billion) in FY21.
While losses stood at INR 59,549.1 crore ($8.2 billion) at the end of fiscal 2022.
In 2022, the company raised additional funds by issuing new shares, and net cash flow from financing was at INR 16,953.5 crore ($2.3 billion).
Flipkart also invested INR 18,850 crore ($2.6 billion) in its Indian subsidiaries in FY22, an increase of INR 7,776.5 crore ($1.1 billion) over the previous year.
What they're saying: Walmart, the majority shareholder in Flipkart, has stated that the cash available to the company will be used to fund its operations. Flipkart has not commented on its financial situation.
Catch up quick: Flipkart, an Indian e-commerce company owned by Walmart, may need to seek additional funding in 2023 due to a lack of cash for operations. The company has been investing heavily in its operations and facing increased competition, and its financial struggles could have an impact on the overall e-commerce industry in India.
If you like this kind of short format articles, Then please subscribe to our newsletter to support.
