Walmart eyes growth through wholesale business in India

After expressing concerns over FDI norms in

multi-brand retail and with rumours of a split with its India partners Bharati Enterprises, US-based retail giant Walmart is positive about growing its wholesale business in the country.

It expects to grow its ‘Best Price Wholesale’ cash and carry business in India, while exploring future retail investment opportunities once it is satisfied with the FDI policy. Bharti Walmart, a 50:50 joint venture between Walmart and Bharti Enterprises, operates wholesale stores under Best Price name.

Earlier reports suggested that the two were looking at parting their six-year-old partnership in India. It was also reported that the company has decided not to convert the 100 million dollars (over Rs 600 crores) loan it had granted to the holding company of Bharti Retail into equity. As per sources, the retail giant has also pulled out a key person, Mitch Slape, a Walmart veteran and the COO of Bharti Retail from front-end retail operations in India. The developments hint at Walmart’s changing strategy for the country.

The US retailer Walmart had invested 100 million dollars (over Rs 600 crores) in Cedar Support Services, an arm of Bharti Ventures in 2010. And though the government increased the FDI limit in multi-brand retail to 51 percent last year, Walmart may not take advantage of it by converting the 100-million dollars loan into equity, which would have given it an indirect 49 percent stake in Bharti Retail.