New Delhi : Japanese conglomerate SoftBank Group on Monday said its operating profit has jumped over 49 per cent in the June quarter, helped by its sale of shares in Indian e-commerce firm Flipkart.
The company, which registered operating income of 715 billion yen ($6.42 billion) during the quarter, also attributed the growth to sale of the majority of chip designer ARM Holding’s Chinese operations.
“(Operating income was) Boosted by valuation gain of 244.9 billion yen at SoftBank Vision Fund: valuation gain of 164.3 billion yen ($1.4 billion) was recorded for Flipkart based on the expected sales price, following the sales agreement,” SoftBank said. It also recorded a “one-time gain of 161.3 billion yen following Arm’s China business becoming an associate from a subsidiary due to the establishment of a joint venture”, it added.
SoftBank said it estimates that the sale of Flipkart shares will occur within 24 months of the inception of the investment.
It added that the company has “calculated the deferred tax at 43.68 per cent, being the Indian short-term capital gains tax rate expected to apply to the sale of Flipkart shares”.
In May this year, SoftBank had decided to sell its about 20 per cent stake in Flipkart to US retailer Walmart. The deal is estimated to help SoftBank rake in about $4 billion from the sale.
