Wal-Mart Stores Inc. (WMT – Analyst Report) has been trying hard to enter the lucrative market of India. However, Indian regulators have been reluctant to let large foreign retailers such as Walmart build up their presence in the country. Walmart has thus decided to take another route to India and announced the opening of wholesale stores.
Walmart plans to launch its business-to-business e-commerce platform in India in July. The retail giant said that the e-commerce service will be available only for its trader members. The first two Indian cities to have this service will be Lucknow and Hyderabad. Though the company will eventually roll out the service in other cities but that will not be before Jan 2015. The company aims to have 10% of the orders for each store from the website within two years of operation. In fact, Walmart has valued the cash-and-carry business of India at around $50 billion by 2020.
The move to launch an online platform in India will help boost the company’s sales. Walmart struggled with declining same-store sales at its U.S. units through fiscal 2014 and even in the first quarter of fiscal 2015. Moreover, the openings will allow the company to strengthen its position in Asia’s second-most populous nation – India.
— Zacks Investment Research