Walmart‘s plans to launch the much-anticipated initial public offering (IPO) of Flipkart, which it acquired for $16 billion six years ago, face significant regulatory roadblocks in India. Despite Flipkart’s status as the country’s largest e-commerce platform, outpacing Amazon, its IPO is unlikely to happen in 2025, with a 2026 launch appearing more plausible. The delay is not due to business performance, but rather the complex regulatory environment in India.
Flipkart’s reach and influence across India’s vast geography make it a formidable player, but foreign-backed e-commerce platforms face tough restrictions. Indian laws prevent them from owning inventory, a measure aimed at protecting local businesses like small kirana stores. However, these rules appear targeted at keeping foreign giants like Walmart and Amazon from dominating the market, despite large Indian companies benefiting from global investments.
The Indian government has taken a hard stance against foreign firms, with recent raids on Flipkart and Amazon sellers investigating potential violations of foreign-investment laws. Additionally, accusations of “predatory pricing” and anti-competition concerns have led to scrutiny from India’s Enforcement Directorate and the Competition Commission.
While e-commerce is still a small portion of India’s retail market, it has seen explosive growth, leading to a fierce competition for consumer attention. However, quick commerce models like Blinkit and Zepto face challenges outside major cities, making the long-term sustainability of such services uncertain. As Walmart and Amazon navigate these regulatory obstacles, India’s retail sector could see significant shifts, particularly if the US government pushes for greater market access.