PhonePe Valuation Results in Walmart Facing $1B Tax Bill
January 5, 2023
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Walmart Inc ($NYSE:WMT). is one of the world’s largest companies and providers of retail goods, with operations in the United States, Canada, Mexico, China, India, and the United Kingdom. It is also one of the world’s largest public corporations by market capitalization, and is the largest grocery retailer in the United States. Walmart also owns and operates Sam’s Club, a chain of membership-only retail warehouse clubs, and operates e-commerce websites in the U.S. and internationally. Recently, Walmart and other shareholders of the Indian fintech startup PhonePe were hit with a $1B tax bill due to a higher-than-expected valuation of the company. After PhonePe relocated its headquarters from Singapore to Bangalore, India, it attracted potential investors at a pre-money valuation of $12B. This high valuation meant that Walmart and other shareholders were liable to pay a significant tax bill.
To raise funds for the tax bill, PhonePe is in talks with General Atlantic, Qatar Investment Authority and other potential investors. The $1B tax bill has come as a surprise to Walmart and other investors due to the unexpected valuation of PhonePe. This could make it difficult for the company to raise the necessary funds to pay the bill without impacting its current operations. The implications of this tax bill could have a major impact on Walmart’s investments going forward and could lead to changes in how they invest in foreign companies. Despite this setback, Walmart remains committed to investing in India and is optimistic about PhonePe’s future.
Market Price
On Wednesday, Walmart Inc. faced a $1 billion tax bill after the valuation results of its subsidiary, PhonePe, were revealed. The company’s stock opened at $143.4 and closed at $143.8, up by a slight 0.1% from the prior closing price of 143.6. PhonePe is a digital payments platform owned by Walmart Inc. and has seen tremendous growth in recent years. This means that Walmart Inc. will be liable to pay capital gains tax on the appreciation of the company’s value. Walmart Inc. will have to pay the $1 billion in taxes within the next few weeks.
This is a significant expense for the company and could impact its financial position in the coming months. This news has sent shockwaves throughout the investment community as investors are now keenly watching to see how Walmart Inc. will manage this unexpected expense. The company has yet to comment on the situation, but it is expected to make an announcement soon. It will be interesting to see how this situation plays out in the coming weeks and months. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Walmart Inc. More…
| Total Revenues | Net Income | Net Margin |
| 600.11k | 8.97k | 1.5% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Walmart Inc. More…
| Operations | Investing | Financing |
| 23.59k | -17.45k | -10.3k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Walmart Inc. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 247.66k | 167.27k | 27.98 |
Key Ratios Snapshot
Some of the financial key ratios for Walmart Inc are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 4.8% | -0.9% | 2.5% |
| FCF Margin | ROE | ROA |
| 1.2% | 12.4% | 3.7% |
VI Analysis
Investing in a company requires researching into its fundamentals, and understanding its long term potential. VI app provides a simple way to analyze the business and financial aspects of a company, in order to make an informed investment decision. For example, WALMART INC is given a low risk rating according to the VI Risk Rating system. This means that the company is less likely to experience financial or business risks that could affect its performance in the future. The rating is based on an analysis of various financial and business factors, such as profitability, liquidity, leverage, and market sentiment. By registering with VI app, investors can get more detailed insights into potential areas of risk for the company. This includes a breakdown of the company’s financials, such as revenue growth, operating margins, cash flow, and debt levels. Additionally, investors can access information about the company’s business model, such as its competitive advantages and strategic positioning in the market. Overall, VI app provides a simple way to assess a company’s risk profile in order to make an informed investment decision. By understanding WALMART INC’s fundamentals, investors can make a more informed decision about its long term potential. Register with us today to start exploring the risks and opportunities associated with investing in WALMART INC. More…
VI Peers
The retail industry is highly competitive, with Walmart Inc competing against Target Corp, Sprouts Farmers Market Inc, and Costco Wholesale Corp. All four companies are vying for market share in the retail sector. Walmart Inc is the largest company in the group, followed by Target Corp, Sprouts Farmers Market Inc, and Costco Wholesale Corp. All four companies are publicly traded on the stock exchange.
– Target Corp ($NYSE:TGT)
Target Corp is an American retail corporation. The company was founded in 1902 and is headquartered in Minneapolis, Minnesota. Target operates 1,851 stores across the United States. The company’s store format includes Target, Target Greatland, and SuperTarget. Target is the second-largest discount retailer in the United States, behind Walmart. The company’s revenue for 2018 was $75.4 billion, and its operating income was $5.9 billion. Target’s net income for 2018 was $3.6 billion, and its total assets were $42.5 billion as of December 31, 2018.
– Sprouts Farmers Market Inc ($NASDAQ:SFM)
Sprouts Farmers Market Inc is a grocery store chain that specializes in selling fresh, natural, and organic food. The company has a market capitalization of $3 billion as of 2022 and a return on equity of 21.14%. Sprouts Farmers Market operates more than 340 stores in 22 states across the United States. The company was founded in 2002 and is headquartered in Phoenix, Arizona.
– Costco Wholesale Corp ($NASDAQ:COST)
Costco Wholesale Corporation is the largest membership warehouse club in the United States. As of 2022, it had a market capitalization of 209.47 billion and a return on equity of 24.62%. Costco Wholesale Corporation is a bulk retailer of food, electronics, and other merchandise. It operates through a chain of membership warehouses in the United States and other countries. Costco Wholesale Corporation was founded in 1976 and is headquartered in Issaquah, Washington.
Summary
Walmart Inc. is facing a potential $1 billion tax bill due to its acquisition of PhonePe. This could have an impact on the company’s overall valuation. Investment analysis suggests that the company has a low risk, as it is an established retail giant with a large and diversified customer base.
Additionally, Walmart has made strategic investments in technology to enhance their customer service and stay ahead of the competition. The company is also investing heavily in e-commerce to drive growth and profitability. Despite the potential for a large tax bill, Walmart’s fundamentals remain strong and it is likely to remain a strong investment for the long term.
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