Flipkart valuation declines by over ₹41,000 crore in two years

Flipkart's valuation drops by $5 billion to $35 billion in 2024 due to PhonePe demerger, despite potential $38-40 billion valuation.

E-commerce firm Flipkart's valuation has declined by $5 billion or around ₹41,000 crore as of January 2024 compared to that in January 2022, according to equity transactions carried out by its U.S.-based parent firm Walmart.

The valuation of the e-commerce firm declined to $35 billion as of January 31, 2024, from $40 billion in the financial year ended on January 31, 2022, as per Walmart's change in equity structure in Flipkart.

Flipkart attributed the decline in valuation to the demerger of fintech firm PhonePe into a separate company. Sources, however, peg the current valuation of Flipkart in the range of $38-40 billion.

Walmart diluted 8% equity in Flipkart for $3.2 billion in fiscal year (FY) 2022 reflecting the enterprise value of the e-commerce at $40 billion.

The U.S. retail giant in FY2024 increased its shareholding by 10% to approximately 85% by paying $3.5 billion, reflecting the enterprise valuation of Flipkart at $35 billion.

"During fiscal 2024, the company paid $3.5 billion to acquire shares from certain Flipkart noncontrolling interest holders and settle the liability to former noncontrolling interest holders of PhonePe. The company's ownership of Flipkart increased from approximately 75% as of January 31, 2023, to approximately 85% as of January 31, 2024," Walmart said.

Flipkart, however, countered the decrease in valuation shown as per Walmart's report and termed it an "appropriate adjustment" in the company's valuation.