Will Walmart-Flipkart deal change the face of Indian Startups forever?

Flipkart Chart1

Venture Capital firm Tiger Global put up $1 billion over a series of investments that began in 2009, and previous year Japan's SoftBank Group Corp. invested a whopping $2.5 billion in the e-tailer.

The $16 billion controlling stake, announced Wednesday, is the largest acquisition yet by the world's largest retailer.

With U.S. -China relations in a fragile state, American companies are taking a closer look at India for opportunities.

Chirag Haria, founder of Aarogyam Energy Jewellery, a top jewellery seller on Flipkart, said the seller community is somewhat anxious about Walmart's private labels.

The sale of home-bred e-tail company Flipkart to Walmart, the world's largest company with $500 billion in revenues, signifies a coming of age for Indian e-commerce enterprises. The company has grown rapidly and earned customer trust, leveraging a powerful technology foundation, including artificial intelligence, and emerging as a leader in electronics, large appliances, mobile and fashion and apparel.

Kotak added that Walmart's acquisition of Flipkart will effectively consolidate the Indian e-tail sector into a two-player market while the ensuing balance sheet strength will drive investments in infrastructure, efficiencies, and be ultimately positive for the Indian consumer. So India's retail market is about the same as Walmart's annual turnover. And there, Amazon is still king, ruling over 40 percent of e-commerce market share.

Steuart Walton, grandson of Walmart founder Sam Walton, Judith McKenna, president at Walmart International, and Dirk Van den Berghe, regional CEO of Walmart Canada and Asia, will join the Flipkart board, following Walmart's proposed acquisition of Flipkart.

L Badri Narayana, partner at law firm Lakshmikumaran & Sridharan, had explained, "In the case of SoftBank US's share transfer to Walmart, the withholding tax, depending on the time they were held, is likely to be 10%".

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Flipkart is, in some ways, an echo of Amazon. Firstly, nowhere has the promise of India's booming middle class proven to be more hollow then when it comes to how e-commerce sales have panned out over the last three years. Free for 14 days - no credit card required!

Flipkart's stock options are granted over a four-year period, with employees allowed to vest them every month after a one-year threshold.

Besides, the payment firm also received Rs 518 crore infusion from the parent company based out of Singapore in March this year.

Amazon had been considering making its own offer for the Indian firm, which has more than 100 million users. Technically speaking, Flipkart India's shares haven't been sold at all but, Flipkart Singapore, the report added.

At its 21 Best Price wholesale stores, Walmart sells everything from fast-moving consumer goods to furniture to other retailers and institutions.

The CPI-M said it was common knowledge that Walmart sourced its products from worldwide markets and now these will be sold in India, further destroying the small scale and medium scale sector which is the largest provider of employment after the agricultural sector.

The way the two, who are not related, formerly worked for Amazon.com Inc and founded Flipkart by selling books before selling everything from soaps to smartphones and from books to clothes, turned out to be a guidebook for many.

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