Matter Of Minutes: Can Flipkart Strike A Fiscal Balance Ahead Of IPO?

Can Flipkart beat a mile a minute? As the road to D-Street neared its end, the ecommerce giant has flicked into quick commerce, rolling out Minutes. The question now staring at its American parent Walmart is how much cash burn will it endure as a late entrant in a party of seasoned players. 

Digital payments major PhonePe, another Walmart-run entity, had to fork out a fortune for a reverse flip to India ahead of its public float next year.   

The US retail behemoth is in no mood to sit on its two big-ticket acquisitions. Walmart had spent $16 Bn when it picked up 77% stake in Flipkart in 2018 and subsequently raised it to 80%. The entire block is worth around $30 Bn today, while its 70% holding in PhonePe is pegged at $6-7 Bn.

Share sales in the two companies sometime in 2026 will help Walmart map its way out, at least partially. 

PhonePe had to cough up INR 8,000 Cr in taxes when it moved its domicile back to India from Singapore in January 2023. Flipkart, which just got its board approving a reverse flip to India, will have to shell out more. 

In the run-up to the IPO, the Walmart management sounded upbeat on Flipkart. “We invested a little bit more in Flipkart this year, which contributed to a little bit of pressure on its bottomline, but the topline has been doing really well,” Walmart CFO John David Rainey said at the 2025 Oppenheimer Consumer Growth and E-Commerce Conference on June 10. 

Flipkart’s marketplace revenues increased 21% on-year in FY24 to INR 17,907 Cr and its losses shrank 41% to INR 2,358 Cr. In comparison, rival Amazon recorded a 14% rise in revenue to INR 25,406 Cr and INR 3,649 Cr losses. Smaller horizontal ecommerce player Meesho, which has been quickly eating into Flipkart’s market share, saw its topline zoom 33% to INR 7,615 Cr and losses reduce by 82% to INR 305 Cr. 

“What is interesting here is that unlike Meesho, which is also heading for an IPO, Flipkart’s scale is much higher and the losses only increased after Walmart acquired it majorly because of aggressive expansion into Tier-II and III towns, setting up large warehouses, having in-house logistics, and acquisition of nearly a dozen companies,” argued a former Flipkart CXO who has worked with CEO Kalyan Krishnamurthy. 

“At this juncture, if Flipkart aims to cut losses (further), it has to shut down some acquired companies that aren’t working and at the same time maintain its leading position in the core commerce business. It’s a double-edged sword. Unlike a few years ago, when Kalyan had to deal with just Amazon, today he has Meesho and not to forget Blinkit, Instamart and Zepto eating away the ecommerce share.” 

And, Flipkart could never afford to lose its ecommerce revenues. It jostled into the speed delivery segment with the launch of Flipkart Minutes last August. 

That’s when the game of balance was kicked off in India’s one of the oldest ecommerce startups on the field since 2007. 

Was The Time Right For Minutes?

Minutes gatecrashed into a blazing market of 10-minute deliveries to save its revenues from the deep-pocket quick commerce players who were expanding their ambit from groceries to gadgets and beyond.

The move was forced, yet it struck the right chord with its parent, as the Donald Trump administration pushed India to give US retailers like Walmart and Amazon full access to its $125 Bn ecommerce market as part of a bilateral trade deal negotiations. The current regulations allow the US companies to run a marketplace and not hold any inventories. 

This non-tariff barrier has long frustrated American retail giants seeking wider access to India’s $2.4 Tn consumer market, which is growing to be the world’s second largest at $4.3 Tn by 2030. As Trump’s 26% reciprocal tariff went on hold for 90 days, the US-India trade talks gathered some momentum.

The trade negotiations flashed the silver lining for Minutes. “That’s a part of ecommerce that we want to be playing in,” Walmart International CEO Kathryn McLay said at the Bernstein Annual Strategic Decisions Conference on May 28-29, recounting that quick commerce was making up 20% of India’s ecommerce market with a 50% growth rate. 

McLay’s remarks coincided with Flipkart CEO Krishnamurthy saying that Minutes will raise its dark store count to 800 by the end of 2025. To fund this growth, it has raised more than $644 Mn from its Singapore-based parent in the past few months, while the marketplace arm, Flipkart Internet, received a $262 Mn cash infusion barely two months after the company received $382 Mn from its parent.

Of Rising Topline And Crumbling Bottomline

Dunzo’s former boss Kabeer Biswas, who now heads Flipkart Minutes, told Inc42 that the company is halfway through its target of 800 dark stores announced last year. 

Flipkart Minutes has scaled rapidly across 17 cities, including Ahmedabad, Bengaluru, Chennai, Delhi NCR (Gurgaon, Noida, Ghaziabad, Faridabad), Guwahati, Jaipur, Kolkata, Kanpur, Lucknow, Mumbai, Pune, Thane, and Chennai. “Minutes has seen a strong, accelerated growth and is doubling its orders per day (OPD) run rate every 45 days.” 

“Our dark stores are powered by AI-driven architecture for forecasting and automated order management systems. We have seen an increasing traction for daily essentials beyond metros, particularly in Tier-I and Tier-II cities. There has also been a rise in demand for high-value products,” Biswas said.  

With the US trade deal negotiations on and the process of a reverse flip started, Flipkart has been exploring office spaces in Gurugram since December. “A 100-200-seater facility is what Flipkart has been looking for,” confirmed a senior executive at a real estate firm the company is talking to.

Flipkart finds itself at a crossroads here. The business of quick commerce is a cash-guzzler as it’s all about running against time. While Flipkart needs to route a large part of its money into Minutes to sustain in this simmering market, its upcoming IPO calls for major investments in the core ecommerce business as well. 

Should it chase revenue by burning capital in quick commerce, or should it stay the course of sustainable growth to protect margins ahead of its public listing? This balancing act between topline expansion and bottomline discipline, according to insiders, is now defining the key decisions in the Flipkart leadership.

Of Dark Stores And Fulfilment Centres 

For Flipkart, quick commerce was more of a compulsion than a natural expansion. Its late entry into the booming market, which is likely to reach $9.95 Bn by 2029, testifies the reality. Media reports and company sources stress that even though Flipkart may meet the dark store target for 2025, the focus will not expand beyond Tier-I and II towns. 

“Quick commerce as a business model is relatively new and it’s still not a very successful proven concept in non-metro markets. The task of achieving a breakeven per dark store is not easy as is proven by the unit economics of incumbent players,” Karan Taurani, who is the senior vice-president at Elara Capital, told Inc42. 

“Second, ecommerce and quick commerce are very different business propositions. One operates on fulfilment centres where lead times are extremely vague and optimised for next-day delivery or two-day delivery, while the other runs entirely on time and operates through dark stores. Third, while quick commerce assortments are more personalised and geography-based, ecommerce is like a widespread assortment across categories.” 

Many Flipkart employees – both former and existing – believe that repurposing fulfilment centres for dark stores will be futile since a majority of these FCs are away from the dense demand centres from where the quick commerce demand is being generated.

“Quick commerce cannot be an add-on feature. We have seen that all major players had to build it from scratch with SKU assortment based on the frequency of orders, shorter restocking cycles, dark stores within 5 km from each other, and so on. None of these exists in ecommerce operations,” an industry analyst said. The dark store model needs a grounds-up approach from warehousing to deliveries, according to him.  

“Flipkart Minutes has successfully managed complex supply chains and high-traffic digital environments. This has enabled us to develop Minutes on Flipkart’s existing database of pincodes, allowing the deliveries directly to customers without the need to build a supply chain from scratch. It gives us a significant long-term advantage,” Biswas said. 

He believes that the success of Minutes will hinge on the 500 Mn customer base data that Flipkart has and a robust last-mile network powered by Ekart.

Of Cash Burn And Profitability 

Zepto, arguably the highest cash-burner in the quick commerce space with its monthly spends shooting past INR 250 Cr because of discounts, free deliveries, cashbacks, and brand commissions, has begun cutting costs and reportedly resorting to a better financial discipline as it gears up for a public issue.

This could give some leeway to Flipkart along the way to the capital market. “While Zepto goes slow on discounting and customer acquisition costs, Flipkart may have an opportunity to make its mark before its flagship sales event,” a former Flipkart senior executive quoted earlier said.

But the catch remains the cost. Flipkart has spent the last few years tightening its financials – raising seller commissions, scaling advertising revenues, and rationalising logistics costs through Ekart. It is also reducing stakes in non-core businesses.

In February, Flipkart shut down its ecommerce enabler business ANS Commerce, which it had acquired a few years ago. It also sold its 9% stake in Aditya Birla Fashion for INR 582 Cr and a stake in logistics firm Blackbuck for INR 672 Cr. The company also trimmed its workforce by 5-7% through a performance review exercise to lower costs.

But there are whispers of apprehension that doubling down on Minutes could undo all these gains. “We’ve spent five years bringing down the burn,” said a senior executive involved with Flipkart’s P&L planning. “One wrong bet, and we’re back to 2017 levels of cash consumption.”

Walmart, however, is pushing for capital efficiency and a clear path to EBITDA breakeven. This doesn’t augur well for the aggressive capex needed for Minutes to succeed. As the financial paradox unfolds, the $36 Bn ecommerce giant finds it hard to strike a balance in the run-up to the much-talked-about public issue. 

Quick commerce is an exciting growth lever, but it also brings risks, complexities, and thinning margins.

Can Groceries Spice Up Minutes?

Flipkart had an earlier stint in rapid delivery with its 90-minute format, Flipkart Quick, which would sell groceries. Sateesh Meena of Datum Intelligence believes that Flipkart will have to attempt again to get a breakthrough in online groceries even as electronics (primarily mobile phones) and fashion remain its key strengths.

Its $145 Mn investment in agritech startup Ninjacart in 2021 and its in-house logistics firm Ekart were expected to help Quick tackle supply chain constraints and reach the metro consumers even when quick commerce was yet to come up.

“At that point, there was just Big Basket and Amazon Fresh attempting same-day deliveries. But operational inefficiencies soon forced them to scale down. Blinkit, Zepto and Instamart changed the rules of the game and even for them groceries remain a key driver,” Meena said. 

Around 80% of the online grocery orders are served by quick commerce platforms. For Flipkart, mapping their dark stores in demand areas might not be difficult since the incumbents are now setting them up in key areas. “The challenge here is that online groceries is a saturated market in top cities and it is only a discount game. So, if Flipkart pulls up on that front, it can actually make consumers shift to its platform.” 

Industry sources say that Minutes has assigned a former Ninjacart top executive, Salhath Khan, as the director of grocery category. “Khan will have the key challenge to partner with the brands in the unorganised fresh produce market along with overcoming challenges like inventory wastage which had been a key challenge for Flipkart,” a senior category manager at Flipkart said.

In terms of scaling beyond groceries, Meena suggested that the company should offer bundled services in fashion and electronics in festive season sales. “The annual Big Billion Days Sale will be an acid test for the efficacy of the quick commerce business.” 

Quick commerce, according to Datum Intelligence, eats away 10-15% market share in non-grocery categories from ecommerce giants. Flipkart’s exclusive partnerships with OEMs (mobile phone manufacturers) and its strong presence in fast fashion (through Myntra) will help it tide over challenges considering that it can mobilise consumers to Minutes.

“There is definitely a market saturation when it comes to grocery purchases in key markets. Flipkart is not addressing any new market but will have to convince consumers to shift. This is not going to be easy,” Meena said. 

Minutes After Flipkart Flies Into Bourses 

 Flipkart plans to step on the gas on its quick commerce play after the public listing, which is expected to raise the company’s valuation to $50-60 Bn, depending on how the market reacts to the IPO.  

“Flipkart Minutes is also likely to go down the path of a standalone app like that of Zomato, Swiggy and Zepro after the IPO,” Meena said. 

Speculation is also rife on potential acqui-hires or strategic investments in smaller quick commerce startups to build up capability without heavy capital commitment.

Until then, Minutes serves as both a hedge and a narrative tool – demonstrating Flipkart’s ability to stay relevant in a fast-changing retail landscape, while not derailing its IPO ambitions under cost load.

Flipkart’s tough balancing acts find support in the performance metrics and legacy infrastructure it runs on. As the ecommerce major gears up to go full throttle on Minutes, Flipkart insiders said its full-scale expansion has been measured, and tightly budgeted. Additionally, the company is leaning on its core categories – fashion through Myntra, and electronics and seller-driven ad monetisation – to shore up profitability in FY25 and FY26, they said. 

Kabeer Biswas’s confidence in Flipkart Minutes looks solid, but its success will depend on how efficiently the platform can scale without reigniting the burn cycle.

“Flipkart is trying to sprint in a marathon. The danger is, they could trip trying to do both,” an industry veteran summed up the game plan. 

[Edited By Kumar Chatterjee]