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ICP Team 12 pres 2

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Marcel Schnarwiler

on 2 February 2014

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Transcript of ICP Team 12 pres 2

U.S. publicly listed company founded 1969

World's largest retail company (USD 446 billion sales in 2012 / 2.2m employees)

26 countries - 72% of sales in the U.S.
Walmart has to grow internationally to keep the overall yearly revenue growth of 6%.
Government and Politics

Retail sector is highly political / Elections in May 2014 are very decisive

Growing urban middle class

Growing GDP and urbanization will lead to a significant growth of the middle class

Number of middle/higher income households are expected to double by 2020
Retail in India
Walmart in India so far

Joint Venture with Bharti group 2006 - 2013 (ended in October 2013)

Walmart solely owns now 20 wholesale outlets and 4 training centers in India (presence in 8 states)

Bribery investigations in India ongoing

On January 15, 2014 new company "Walmart India Private Ltd." was registered for retail purposes
Our day in Mumbai

Store visits (Kirana stores, supermarket and mall hypermarket) and consumer interviews with Nestlé sales representative

Meeting with Ms Amrita Dhar, McKinsey India retail expert

Meeting with Mr. Anshuman Singh, Future Group, head of supply chain
Major growth potential

The Indian retail market is one of the fastest growing markets in the world due to economic growth

India to become the world's fifth largest consumer market by 2025

Only around 5% of retail market is modern retail
Source: McKinsey
Develop an investment project for Walmart to further expand in India
Growing population
and urbanization
Growing middle-class
Western convergence
Less regulations

Faster growing segment

Key customers are the
fast growing middle class

Capability to differentiate
towards competitors

FDI regulation

Highly political environment
(license per state)
Max. 51% shareholding
100m investment
Min. 30% local sourcing
Our thanks go to
and many
Our key learnings

Immense diversity within one country

Unorganized and very fragmented retail environment

Very political topic

Maximum Retail Price (MRP)

Growth and potential of middle class
Source: McKinsey
583m people
in 2025

USD 1.1b

58% total
Indian income

Source: McKinsey
Full transcript