Walmart-owned Flipkart has completely exited its investment in Aditya Birla Fashion & Retail Ltd (ABFRL) by selling its entire 6% stake for Rs 582 crore through a bulk deal on the Bombay Stock Exchange (BSE) on June 4, 2025. The transaction involved offloading 7.31 crore equity shares at an average price of Rs 79.50 per share, representing a 7.6% discount to ABFRL’s previous closing price of Rs 86.06. For investors, fashion retail analysts, and market watchers searching Flipkart ABFRL stake sale, ABFRL shares drop 11%, or Flipkart exits Aditya Birla Fashion 2025, this full divestment—executed via Goldman Sachs as the bookrunner—comes amid ABFRL’s ongoing restructuring, including the demerger of its Madura Fashion & Lifestyle business into Aditya Birla Lifestyle Brands Ltd (ABLBL). ABFRL shares plunged 11.49% to an intraday low of Rs 76.10 before recovering slightly to close at Rs 77.08, reflecting investor concerns over the exit and the company’s recent net loss of Rs 23.55 crore in Q4 FY25.
The sale concludes Flipkart’s four-year partnership with ABFRL, initiated with a Rs 1,500 crore investment in October 2020 to bolster its fashion ecosystem.
Deal Structure and Transaction Details
Flipkart Investments Private Ltd, a subsidiary of Flipkart, divested the full 6% holding—equivalent to 7.31 crore shares—in a single block trade on the BSE. Goldman Sachs acted as the sole bookrunner, with the floor price set at Rs 79.50 per share, a 7.6% discount to the prior close.
- Shares Sold: 7.31 crore (6% stake).
- Sale Price: Rs 79.50 average (floor price).
- Total Value: Rs 582 crore (approx. $70 million).
- Buyer: Not publicly disclosed, but block deals typically involve institutional investors.
The transaction occurred amid ABFRL’s demerger of its lifestyle brands (Louis Philippe, Van Heusen, Allen Solly) into ABLBL, expected to list by June-end 2025. ABFRL’s Q4 FY25 net loss narrowed to Rs 23.55 crore from Rs 266.36 crore YoY, with revenue up to Rs 1,719 crore.
| Deal Parameter | Value | Notes |
|---|---|---|
| Stake Sold | 6% (7.31 Cr Shares) | Full Exit |
| Floor Price | Rs 79.50 | 7.6% Discount to Rs 86.06 |
| Total Proceeds | Rs 582 Cr | Managed by Goldman Sachs |
| Stock Reaction | -11.49% Intraday | Closed at Rs 77.08 |
Market Reaction: ABFRL Shares Tumble 11%
ABFRL shares opened sharply lower, hitting a 52-week low of Rs 76.10 before partial recovery. The 11% drop erased Rs 1,200 crore in market value, reflecting concerns over Flipkart’s exit signaling limited growth prospects. ABFRL’s stock has declined 19% over the past year, trading below its 52-week high of Rs 121.74.
Analysts view the sale as Flipkart reallocating capital to core e-commerce amid ABFRL’s loss-making units like TCNS and TMRW. ABFRL plans Rs 500 crore capex in FY26 to revive these brands.
Strategic Implications: Flipkart’s Fashion Pivot
Flipkart’s exit ends a partnership aimed at scaling fashion via Myntra-ABFRL synergies. The 2020 investment supported ABFRL’s digital push, but Flipkart’s focus has shifted to quick commerce and global expansion.
- For Flipkart: Frees Rs 582 crore for investments in Blinkit and international markets.
- For ABFRL: Loss of a strategic partner; demerger into ABLBL could unlock value, with Pantaloons and ethnic wear as focus areas.
- Industry Outlook: Fashion retail grows 15% CAGR, but e-commerce competition intensifies.
Conclusion: Flipkart’s Clean Exit from Fashion Retail
Flipkart’s Rs 582 crore sale of 6% ABFRL stake caps a strategic divestment, triggering an 11% share drop. As ABFRL restructures, it’s a pivot for both. For investors, it’s a signal—will demerger revive ABFRL? The racks refill. ET
