Wal-Mart Updates: India Opens Doors to Foreign Retailers

Last week has been an eventful one for Wal-Mart (NYSE:WMT). Recently, India approved overseas companies to own as much as 51% of retailers selling more than one brand. We consider this as a major recent development which could pave a bright way forward for retailers like Wal-Mart to own stores in the country. The foreign companies are required to invest at least $100 million, half of which has to be spent on developing back end infrastructure. According to Business Monitor International, Indian retail market is expected to double to $785 billion by 2015 from $396 billion this year. ^[1]

In an interview last week, Steve Dacus Walmart Japan’s President and CEO cited that Wal-Mart plans to open 20 more stores in Japan in 2012 in order to expand its presence on the island. The new openings will include all of its formats, which range from Seiyu food stores and general merchandise stores to Wakana delis, although most of the new Seiyu outlets will be food stores, with 1,000 to 2,000 square meter range. ((Wal-Mart Japan unit plans 20 more stores in 2012, The Financial Express))

See our complete analysis for WMT stock here

Last week, Wal-Mart increased its total global store count to 10,000 by opening its 10,000th store in Central Mexico. ^[2] This clearly shows the vast presence it holds over different geographies.

Wal-Mart also announced  mixed results last week, witnessing an 8% increase in net revenues. However, its profits declined due to its low pricing strategy. However, its international segment reported a robust growth of 20%. (See our previous post: Wal-Mart’s Profits Take a Hit Due to Its Low Pricing Strategy)

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1. Wal-Mart Japan unit plans 20 more stores in 2012, Reuters [↩]
2. Wal-Mart opens landmark 10,000th store worldwide, Market Watch [↩]