Walmart CFO John David Rainey, believes Flipkart and PhonePe have the potential to become $100 billion enterprises. Rainey emphasized the strong growth of both the companies at an investor conference.
Notably, both of the companies are part of Walmart, The American multinational retail chain. In 2018, Walmart purchased approximately 77% of Flipkart’s shares for $16 billion, making it the largest acquisition in Walmart’s history. PhonePe, which was a subsidiary of Flipkart at the time, also became part of Walmart’s portfolio through the acquisition.
Walmart aims to double its gross merchandise volume in foreign markets to $200 billion within five years. The retailer does not disclose specific sales figures for Flipkart and PhonePe.
Recent months have seen Walmart executives highlighting the significance of these two businesses. India’s population of 1.4 billion presents a “significant” opportunity for Walmart. That’s why Flipkart and PhonePe’s robust growth is crucial to Walmart’s international expansion plans.
Flipkart’s business reported double-digit sales growth in the most recent quarter. New shoppers in various cities and a 50% surge in advertising sales contributed to Flipkart’s growth. The eCommerce market leader is valued at over $40 billion, making it one of India’s most valuable startups.
PhonePe achieved an annualized payment value of $1 trillion, driven by the Unified Payments Interface. The fintech giant holds a dominant 46% share of the payments market in India. It has a user base of 400 million registered customers. Walmart injected an additional $200 million into the fintech giant, valuing the business at $12 billion.
Rainey’s projections for Flipkart and PhonePe reflect their strong growth and market potential. Walmart considers Flipkart and PhonePe as key drivers in achieving its international growth targets.
PhonePe, The Rise Over the Years
PhonePe obtained authorization from the Reserve Bank of India in August 2014. The fintech giant’s coverage extends to a wide range of merchant outlets, both offline and online.
As of the latest reports, over 3.5 crore offline and online merchant outlets accept PhonePe as a payment option. It covers 99% of pin codes in India.
As of June 2018, the fintech giant served more than 10 crore users. By December 2019, it had processed 500 crore transactions. In April 2022, it surpassed 10 crore transactions per day. Currently, it has over 44 crore registered users.
PhonePe has over 20 crore monthly active users. The Reserve Bank of India has licensed it for prepaid payment operations.
PhonePe completed its shift to India and separation from Flipkart in January. The company partnered with Cloudflare to enhance mobile transaction security. In February, it became the first fintech platform to enable cross-border UPI payments.
Launched New Account Aggregator. Becomes the First mover
Recently, on 6th of June Tuesday, PhonePe launched its account aggregator (AA) services. The AA services were introduced through PhonePe Technology Services Pvt Ltd (PTSPL), a subsidiary.
PTSPL collaborated with PhonePe Pvt Ltd to develop an AA micro-app within the consumer app. The AA micro-app enables the seamless exchange of financial data between users and providers. It allows sharing of financial data, such as bank statements and insurance policies. Use cases include loan applications, insurance purchases, and investment advice.
The micro-app allows PhonePe users to register and create an interoperable AA handle easily. Users can access their bank statements instantly through the ‘check balance’ option on the app’s homepage. The fintech giant aims to streamline the process for users to access and control their financial data.
Growth of Flipkart
In April 2022, Flipkart launched its first women-run grocery fulfilment centre in Guwahati. The centre aimed to support the career progression of Flipkart’s female employees. Flipkart established the Flipkart Foundation in the same month to support entrepreneurship and skill development.
In October 2022, Flipkart introduced the Flipverse, a metaverse-based shopping platform. Flipverse allows users to explore products and shop in an interactive way. The platform was developed through a partnership with the Polygon-incubated firm eDAO.
Flipkart ventured into the NFT and Web3 segment by offering Nothing Phone purchasers NFTs through the app. The NFTs were hosted on the Polygon blockchain. The NFT drop took place on Flipkart’s NFT marketplace, supported by GuardianLink.
Flipverse aims to provide a mall-like shopping experience with customizable avatars.
In August 2018, Walmart acquired a 77% controlling stake in Flipkart for $16 billion.
The acquisition valued Flipkart at approximately $20 billion. As of 2022, Flipkart is valued at $37.6 billion.
Flipkart plans to go public through a listing in the United States in 2023. The listing aims to further expand Flipkart’s reach and market presence.
