Flipkart board asks CEO to cut costs as monthly cash burn nears $40 million

Flipkart board directs CEO Kalyan Krishnamurthy to halve the company's monthly cash burn from $40 million to $20 million as firm eyes IPO and plans to shift legal base from Singapore to India

In a recent board meeting, Flipkart’s leadership has been directed to sharply reduce its monthly cash burn, according to a report by Moneycontrol. The move comes as the Walmart-owned e-commerce giant gears up for a possible stock market listing in India and considers moving its holding entity from Singapore. 

Currently, Flipkart spends nearly $40 million each month to fund operations. The board has asked CEO Kalyan Krishnamurthy to bring this figure down to around $20 million over the next few quarters, in a bid to make the company leaner and more financially sustainable ahead of an initial public offering (IPO), the news report said. 

 

Cash burn — the rate at which companies use their capital before turning profitable — is a critical metric, especially for digital-first and startup ventures. A lower burn rate signals better financial health and longevity, reducing the immediate need for fresh funding. 

Krishnamurthy has been tasked with capping Flipkart’s annual cash burn at roughly $250 million, even as the company scales up newer business units, particularly its quick-commerce initiative, Flipkart Minutes.

Balancing expansion and efficiency

Flipkart recently announced plans to launch 500 new dark stores over the next eight months to strengthen its position in the rapid delivery market. This ambitious expansion will require substantial investment and puts additional pressure on the company’s balance sheet. 

The firm’s quick-commerce vertical, Flipkart Minutes, is in direct competition with established players like Zomato’s Blinkit, Zepto, Swiggy Instamart, and Tata’s BigBasket. 

Flipkart has discontinued its pharmacy arm, Flipkart Health+, and is in the process of downsizing other non-core segments. The current focus is on evaluating which business units to continue investing in and which ones to phase out, the report quoted a source as saying. 

   

Rivals and scale

Flipkart spends around $40 million every month, while its rival Zepto was spending over ₹250 crore (more than $30 million) a month, the report said. However, Flipkart operates at a much larger scale, recording a gross merchandise value (GMV) of more than $29 billion, against Zepto’s $5 billion. 

Despite high operational costs, Flipkart has seen improved financial performance in some segments. Its marketplace arm, Flipkart Internet, posted a 21 per cent year-on-year revenue increase in FY24, reaching ₹17,907.3 crore. Losses narrowed by 41 per cent to ₹2,358 crore, supported in part by growing ad revenues.

 

Re-domiciling to India

Alongside efforts to rein in spending, Flipkart is also aims shift its legal domicile from Singapore to India — a strategic move that could ease its path to an IPO on domestic stock exchanges. 

Board members, including CEO Krishnamurthy, SoftBank Vision Fund’s former partner Lydia Jett, HDFC’s Keki Mistry, and Walmart’s Dan Bartlett, were in favour of the re-domiciling plan, the news report said. 

In a statement on April 21, a Flipkart spokesperson confirmed the company’s intent to flip its base back to India but did not elaborate further. 

 

The road ahead

The push to become more capital-efficient comes shortly after Flipkart secured $350 million from Google as part of a larger $950 million fundraising round — its first major capital infusion since being acquired by Walmart in 2018. 

With the move to India underway, Flipkart joins a growing list of Indian startups such as Razorpay, Pine Labs, Zepto, and Meesho that have either relocated their base or are in advanced stages of doing so.