Flipkart Sells Flying Machine Stake for Rs 135 Cr, Part of IPO Push

E-commerce major Flipkart is selling its entire 31.25% stake in Arvind Youth Brands Private Limited (AYBPL), the parent company of Flying Machine, to Arvind Fashions Limited for a sum of Rs 135 crore, regulatory filings showed.

“The Company shall acquire 31.25% of the total shareholding of AYBPL on a fully diluted basis, comprising of 1 equity share of Rs. 10 each and 5,895,852 Compulsory Convertible Preference Shares (CCPS) of Rs. 100 each, upon closing of the transaction,” Arvind Fashion said on Monday (December 29).

Once the transaction is completed, Arvind Youth Brands will become a wholly owned subsidiary of Arvind Fashions.

Arvind Youth Brands sells denim and casual wear under the brand name Flying Machine. It reported a turnover of Rs 432.16 crore in the financial year ended March 31, 2025 (FY25). Notably, that is 5.5% and 8.5% lower than turnover reported in FY24 and FY23, respectively.

The deal is part of Flipkart’s ongoing restructuring exercise as the company seeks to tap the public markets. Over the past few months, the e-commerce startup has fully exited its investment in listed new-age logistics major BlackBuck and sold a 6% stake in Aditya Birla Lifestyle Brands Ltd for about Rs 998 crore through a block deal, as per exchange data.

In a crucial step towards its initial public offering (IPO), Flipkart received clearance from the National Company Law Tribunal (NCLT) earlier in December to bring its Singapore-based entities—including Myntra, Cleartrip, eKart and Super Money, among others—under the fold of the Indian entity Flipkart Internet Private Limited, paving the way for its reverse flip.

However, as per Press Note 3 rules, which regulate investments from countries sharing a land border with India, Flipkart must receive approval from the Centre to complete its relocation, given that Chinese investor Tencent owns a stake in the e-commerce platform.

Notably, the Walmart-backed e-commerce platform is looking to relocate its headquarters as it plans to list its shares on Indian stock exchanges. According to reports, Flipkart is eyeing a public listing in 2026 at a valuation of $60-70 billion, yet official confirmation from the company is still awaited. Its younger e-commerce rival Meesho went public on December 10. Another point to note here is that PhonePe, formerly a subsidiary of Flipkart, which was spun off as a separate company in 2022, has already filed draft papers with the Securities and Exchange Board of India (SEBI) for an IPO worth about Rs 12,000 crore through the confidential route.

Flipkart Internet, the marketplace arm of Flipkart, reported a 14% year-on-year increase in operating revenue to Rs 20,493.3 crore in FY25, while losses declined 37% to Rs 1,494.2 crore.

By comparison, Amazon Seller Services, the entity that operates the Amazon marketplace in India, saw its standalone net loss decrease by 89% YoY to Rs 374.3 crore, with operating revenue up 19% to Rs 30,138.5 crore in FY25.

As Flipkart prepares for a mega IPO, questions loom around its profitability and its ability to resuscitate revenue momentum. At the Group level, Flipkart continues to be loss-making. While Flipkart Internet, eKart and Cleartrip reported a narrowing of losses in FY25, revenue growth remained muted amid a broader slowdown in the retail market.

The sole exception: Myntra. The fashion arm of Flipkart reported its second consecutive year of profitability in FY25 with a consolidated profit after tax (PAT) of Rs 548.3 crore on the back of an 18% jump in its operating revenue at Rs 6,042.7 crore.

While Flipkart is still figuring out its IPO playbook, it has drawn the ire of regulatory authorities. Earlier in October, Union Minister Pralhad Joshi said the Department of Consumer Affairs has launched an investigation into e-commerce platforms for allegedly charging extra for cash on delivery, which has been classified as a dark pattern.

The statement came on the heels of Flipkart’s Big Billion Days and Amazon’s Great Indian Festival, with several users criticising both platforms for levying “offer handling fees”, “payment handling fees”, and “protect promise fees” on top of the discounted selling price.

Earlier in July 2025, Flipkart’s fashion arm Myntra came under the scanner of the Enforcement Directorate for allegedly violating Foreign Exchange Management Act, 1999 (FEMA) norms to the tune of Rs 1,654 crore. The regulator alleged that Myntra Designs Limited received foreign direct investment (FDI) from foreign investors in the guise of a wholesale cash & carry, while actually engaging in multi-brand retail.