The future growth prospects of Walmart India Private Limited show a slight upward trend in its long-term strategy due to a significant improvement in its financial performance in FY25. The company reduced its net loss to ₹109.8 crore against ₹154.1 crore in FY24. Revenue generated by the company increased by a modest 2.5% to ₹5,330 crore, and operational revenue also improved by a similar percentage. These numbers, announced in the reports to the Ministry of Corporate Affairs, indicate that Walmart India is slowly achieving equilibrium within its operations despite the ongoing issues in the competitive Indian retail market. Improved operational efficiency was also reflected in a greater decrease in EBITDA losses and a more punitive cost structure in the fiscal year. 

Net loss and expenses

The net decrease in Walmart India’s net loss to ₹109.8 crore during FY25, compared to ₹154.1 crore last year, was one of the most prominent changes in FY25. The overall loss was ₹110.6 crore, which implies that it is still, but less of a drag on profitability. Although the company is still in the red, the trend will lead to a more stable financial ground.

The cost structure of Walmart India can be further examined to reveal the dynamics of the business model. Trade purchases were ₹4,975 crore, highlighting how the company depends on inventory-intensive operations. Another ₹93.9 crore was added to the expense account as freight and forwarding expenses, and employee benefits amounted to ₹139.4 crore, with ₹122.8 crore in salaries and 9.3 crore in staff welfare expenses.

The other operating expenses increased to ₹191.8 crore, led by ₹29 crore legal and professional fees, ₹34.3 crore rent, and ₹23.3 crore freight and distribution costs. These are indicators of the magnitude and intricacy of logistic and administrative operations in Walmart India that are crucial to its retail footprint.

Although the operations have improved, Walmart India still shows a heavy financial burden in its balance sheet. Total assets of the firm stood at ₹1,302.6 crore and equity share capital at ₹2,830.9 crore in FY25. The accumulated losses have swelled to ₹3,895.3 crore to pull down the net worth to ₹36.9 crore against ₹147.4 crore in FY24.

The current liabilities increased to ₹703.1 crore, whereas the non-current liabilities decreased to ₹558.6 crore. These numbers indicate a change in the company’s financial liabilities, perhaps an attempt to reorganize debt or more aggressive management of short-term liquidity.

Indirect tax demands and integration with Flipkart

The financial statements of Walmart India were audited by Auditor S.R. Batliboi LLP, which set an unqualified opinion on the financial statements of Walmart India, including the sufficiency of internal financial controls. The audit report, however, identified two compliance lapses: the audit trail option was not turned on in the accounting software all through the year, and books of account were not backed up daily on servers situated in India. Though these problems are not fraud and misstatement issues, they are required to be disclosed as per the regulations.

The firm also announced numerous huge indirect tax claims being challenged in different states, such as GST claims in Punjab, Maharashtra, Madhya Pradesh, Telangana, and Andhra Pradesh. Besides this, old cases of VAT, CST, and entry tax of the pre-GST period are yet to be decided. A fine of 5.27 crore on income tax is under appeal. Such contingent liabilities do not require immediate payments, but they may be difficult to meet in the future based on court rulings.

The strategic direction of Walmart India is still influenced by its acquisition of Flipkart in 2020. Although the FY25 outcomes are relevant to Walmart India Private Limited, the entire ecosystem of Walmart in India, such as Flipkart and Phone Pe, will still be the core of the long-term goals of the company. The latest words of Walmart’s CFO show hopefulness regarding the performance and growth opportunities of these platforms and are likely to bring about synergies and scale in the future.

Conclusion

The FY25 performance of Walmart India is a tentative yet promising move toward financial recovery. As the turnover continues to grow with minor improvements in revenue and a reduction in its losses, the company can be said to be stabilizing its operations and cost management. There are still serious concerns, such as violations of compliance and tax issues, as well as a deteriorated net worth and growing debts. As long as the firm is still red, the trend points to a strategic realignment, one that is consistent with Walmart’s wider ambitions in India via its merger with Flipkart and emphasis on retailing first online.