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Softbank Finally Agrees to Pay $600 Million to Indian Government, Sold Flipkart Stakes to Walmart

22May By Sheldan RungasamyNo Comments

BUSINESS

Softbank Finally Agrees to Pay $600 Million to Indian Government, Sold Flipkart Stakes to Walmart

Softbank is finally putting an end to the months of speculations over his future with Flipkart post the Walmart acquisition deal. The Japanese conglomerate has now agreed to sell its 23.6% stake in Indian e-commerce major Flipkart to its new owners, Walmart for around $4 Bn. Several reports varied over the future of Masayoshi Son’s investment firm in the e-commerce giant despite the billionaire CEO unintentionally confirming the acquisition deal on May 9. In fact, the Japan-based company was still analyzing and examining the option of whether or not staying in Flipkart. The reason for this indecision was mainly motivated by the large amount of tax that Softbank would be subject to for leaving a company in such a short term. Softbank acquired 23.6% stakes in Flipkart last year for an ...

Retailers Demand CCI to Take Action Against Walmart-Flipkart Deal

22May By Lavina TolaniNo Comments

News

Retailers Demand CCI to Take Action Against Walmart-Flipkart Deal

Traders Body, Confederation of All India Traders ( CAIT ) has decided to approach fair trade regulator CCI against $16 billion Walmart-Flipkart deal claiming that the agreement would lead to massive job loss and will turn out a nightmare for retail trade in the country. It is interesting to note that US giant Walmart had approached CCI just last week to garner approval for its mega Flipkart buyout stating that it doesn't raise any competition concerns. Meanwhile, the All India Online Vendors Association (AIOVA) industry body on Monday has also moved to Competition Commission of India (CCI) against Flipkart India Pvt Ltd. a wholesale company, for allegedly abusing its dominant position on Flipkart's online marketplace. The body has claimed that Flipkart India Pvt Ltd. sources goods...

Myntra’s losses reduced by 25%, Aims to Track Profits for FY18

21May By Gauri SinghNo Comments

BUSINESS

Myntra’s losses reduced by 25%, Aims to Track Profits for FY18

Myntra’s marketing strategies and intelligence have lately given a boost to the fashion and lifestyle business of its parent company Flipkart. The losses for the FY17 have reduced by 25% to Rs. 655 crore as against Rs. 823 crore in the previous year. The major strategy adopted by the fashion and lifestyle etailer has been the focus on umbrella branding of its private labels, which means the ability of a single brand to reach across categories. The increase in the reach of private brands to the masses led to the decrease in losses for the company. The documents show that the losses presently stand at Rs 627 crore, lessening 23% on a standalone basis. The company’s three-year-old private label business has grown tremendously and accounts for about 25% of the overall revenue. In Septemb...

Flipkart Introduces New Audit Programme for Quality Check

21May By Gauri SinghNo Comments

News

Flipkart Introduces New Audit Programme for Quality Check

Flipkart, India’s one of the biggest online stores has announced that mandatory visits to the sellers’ location to audit their warehouses and merchandise will be done to keep a check on the quality standards and bring down the percentage of return. Though the company did not disclose their present return percentage, it’s quite clear that they have been facing a notable loss of revenue due to high return rate for the sellers as well as the marketplace. The fashion category comprises the major part of the returns and cancellations while the mobile and appliances have the least of it. A monthly report from the e-commerce company to its third-party sellers mentioned that they may anytime give a surprise visit to their warehouses and see if the warehouse and product quality standards are bei...

Walmart Approaches CCI For Approval Over Flipkart Acquisition

20May By Lavina TolaniNo Comments

News

Walmart Approaches CCI For Approval Over Flipkart Acquisition

After acquiring Indian e-commerce unicorn Flipkart, US giant Walmart Inc. has finally sought approval of India's Anti-Trust Regulator for its mega $16 billion acquisition. According to a Regulatory Filing sent to Competition Commission of India (CCI), Walmart has said that its buyout of Flipkart does not result in competition concerns as the broader retail market in India remains unaffected by the deal. Walmart has reported CCI that Flipkart is a Singapore based entity and the deal has been done through its subsidiary Walmart International Holdings. Moreover, Since Flipkart India is primarily engaged in the business of wholesale cash and carry goods, its acquisition will only affect B2B markets, Walmart added. Notably, Walmart has been facing resistance by tough regulations that p...

Azim Premji Makes $130 Million in Flipkart Deal

18May By Sheldan RungasamyNo Comments

BUSINESS

Azim Premji Makes $130 Million in Flipkart Deal

The Walmart-Flipkart $16 billion acquisition must be the biggest fortune that could ever fall on investors in India’s largest e-commerce platform as they are set to receive their biggest payday. However, the e-commerce platform boasted international investors exclusively and therefore, Indians that will benefit from the $16 billion deal are only Flipkart founders and employees. However, one Indian investor will get around 420% returns on an investment he made 4 years ago in fashion e-commerce platform, Myntra, that was subsequently acquired by Flipkart. Indeed, the chairman of Wipro Limited and third richest man in India, Azim Premji is going to receive $130 million from his $25 million investment in Myntra thanks to the acquisition of Flipkart by Walmart, according to two people bri...

SoftBank Is In Talks With Zomato Over A Possible Investment

17May By Lavina TolaniNo Comments

BUSINESS

SoftBank Is In Talks With Zomato Over A Possible Investment

The Japanese Internet Conglomerate, SoftBank Group Corp is reportedly in talks over a possible investment in food delivery and online restaurant company Zomato as told by sources familiar with the matter. The possibility of Softbank's future investment in Zomato has been speculating in the market since six months back when the Japanese giant first held conversations exploring a possible funding of up to $200-250 million in Bengaluru-based Swiggy. "SoftBank which has already backed Flipkart now eyes to make a niche for itself in the food delivery market said one of the sources. The development comes as SoftBank is reportedly yet to decide on selling its more than 20% stake in Flipkart to US retailer Walmart. The Report says that SoftBank is currently discussing business metrics across...

Flipkart FY17 Revenue Growth Cuts Down Losses

17May By Sheldan RungasamyNo Comments

BUSINESS

Flipkart FY17 Revenue Growth Cuts Down Losses

While Flipkart is still filling all legal documents and other details for the Walmart acquisition, Flipkart India, the wholesale arm of Flipkart, was able to cut down losses in FY17 by 55% when compared with FY16. According to filings at the Ministry of Corporate Affairs (MCA), Flipkart reported a net loss of $36 million (Rs 244 Cr) for FY17, which represents a 55% decline from the loss of the previous fiscal year that stood at $80.3 million (Rs 544.5 Cr). On the downside, the e-commerce giant’s total expenses increased significantly by 15%. For FY16, the total expenses of the company stood at $2 billion (Rs 13,722 Cr) compared to the $2.33 billion (Rs 15,813 Cr) in FY17. However, the e-tail business witnessed revenue growth of 19% in the fiscal year of 2017 with revenues standing at...

Foxconn Unit Put Downs Another $40 Mn Investment In Snapdeal

15May By Lavina TolaniNo Comments

BUSINESS

Foxconn Unit Put Downs Another $40 Mn Investment In Snapdeal

While foreign investments have been raining in Indian e-commerce marketplace, Foxconn Technology Group has announced another write off of an additional $40 million of its $200 million in e-commerce company Snapdeal. Earlier in August 2017, FIH Mobile had written in its annual report that its entire $200 million investment in Jasper Infotech ( Snapdeal owner and operator) cannot be recovered. Moreover, Foxconn had registered impairment loss of around $160 Mn for its investment in Jasper Infotech for six months and the loss period ended June 30, 2017. FIH Mobile, The subsidiary of world's largest contractor Foxconn has forecasted that the recoverable amount from its investment in Jasper Infotech is $3 Mn while citing the failed merger between Flipkart and Snapdeal as being one of th...

The New ESOP’s Offer for Flipkart Employees Revealed !

15May By Lavina TolaniNo Comments

News

The New ESOP’s Offer for Flipkart Employees Revealed !

E-commerce Unicorn Flipkart has announced a repurchase ESOP's offer for its employees at a share price ranging from USD 125-129. The offer from the Bengaluru headquartered company comes in the wake of the completion of company's acquisition by US retailer Walmart for roughly USD 16 billion. According to one of the sources familiar with the matter, Flipkart will allow employees, present as well as former to liquidate part of their vested options. This will enable current employees to vest up to 50 percent of their stock options now followed by 25 percent in the second and third year. The transaction price would be in the range of USD 125-129 per option. As far as former employees are concerned, they can vest up to 30 percent of their ESOPs. A company spokesperson also added that the e...

This is Why SoftBank is Reluctant to Sell its 22 % Flipkart Stake

15May By Lavina TolaniNo Comments

News

This is Why SoftBank is Reluctant to Sell its 22 % Flipkart Stake

Post mega Flipkart-Walmart Acquisition, the e-commerce world has been buzzing with speculations all around as to how the mammoth deal will shape the coming scenario. Now, there is a new dimension that has come into play regarding SoftBank unwilling to sell its stakes to Flipkart. If SoftBank was to sell its 22.3% stake in Flipkart Singapore to Walmart now or anytime before August 2019, it may have to hand over a massive $600 million to the Indian taxman out of its profit of $1.5 billion. Just 9 months ago in August 2017, the Japanese multinational conglomerate, SoftBank had announced its investment of $2.5 billion in Flipkart Singapore via SVF Holdings. Understanding the Taxation Dynamics Right after the official announcement, more than 500 funds were set up...

I-T dept to Seek Share Purchase Pact from Flipkart

14May By Lavina TolaniNo Comments

News

I-T dept to Seek Share Purchase Pact from Flipkart

The Income Tax department will seek purchase agreement from Flipkart on the mega e-commerce USD 16 billion buyouts by US retail mammoth Walmart to assess the tax liability and also find out whether the General Avoidance Rule provisions can be invoked as informed by an official related with the matter. The department id presently is referring to Section 9(1) of the Income Tax Law, which deals with the indirect transfer provisions to seek if the benefits under bilateral tax treaties with countries like Singapore and Mauritius could be availed by foreign investors such as Walmart. Singapore registered Flipkart Pvt Ltd has majority stakes in Flipkart India. Post definitive agreement between the companies, Walmart will hold 77 percent stake in the Singapore entity for USD 16 billion. The ...