Flipkart registers new arm Flipkart FarmerMart to enter retail food segment

Walmart-owned Flipkart has registered a new subsidiary, Flipkart FarmerMart, as the ecommerce major moves closer to entering the retail food segment. 

The subsidiary will offer a range of diversified products and packaged food through physical and online distribution channels and also invest in setting up infrastructure such as storage, warehousing, transportation. 

Flipkart FarmerMart has an authorised share capital of Rs 1,845 crore of which shares worth Rs 360 crore will be subscribed by Flipkart group companies Quickroutes International and Flipkart Marketplace, regulatory filings show. 

Before starting the retail food operations, Flipkart had relaunched its online grocery brand Supermart in August 2018, earlier called Nearby, which closed operations shortly after its launch in 2015. Currently, Supermart has operations in Mumbai, Chennai, Bengaluru, Hyderabad and Delhi. 

Flipkart is said to have come late into the segment as US-based Amazon has committed to invest $500 million to sell food products through online and physical stores. Amazon Retail, which has a presence in 100 tier-II and Tier-III cities, is planning to expand to 60 more cities by next year.

In 2016, the government had allowed 100% foreign direct investment in the retail food sector through online and brick-and-mortar stores.  

Home-grown companies BigBasket and Grofers are also established in the online grocery segment.