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Walmart shares tumble over 4%, market cap falls nearly $10 billion 
Date: 13 May 2018
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Walmart shares slumped more than 4% in the morning trade on Wednesday wiping off nearly $10 billion from its market capitalisation, hours after the retail giant announced $16 billion worth Flipkart deal.
The shares took a beating amid concerns that the deal could impact profits of Walmart. The American retail major`s shares fell over 4% on the New York Stock Exchange at around $82.13 apiece.
At this level, the market capitalisation was more than $242 billion, which is way lower than Tuesday`s closing level.
At Tuesday`s closing price of $85.74 per share, Walmart had a market capitalisation of little over $253 billion.
In the biggest deal in the fast-growing e-commerce space, Walmart today said it is buying 77% stake in Flipkart for about $16 billion and it would give the retailer access to Indian e-commerce market that is estimated to grow to $200 billion within a decade.
The deal values Flipkart at $20.8 billion.
“If the transaction were to close at the end of the second quarter of this fiscal year, Walmart expects a negative impact to FY19 EPS (Earnings Per Share) of approximately $0.25 to $0.30, which includes incremental interest expense related to the investment.
“In FY20, as we look to accelerate growth in this important market, Walmart anticipates an EPS headwind in total of around $0.60 per share,” Walmart said in a release.


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