The Tata Group is looking to raise ₹11,050 crore (around $1.3 billion) to expand its digital businesses – BigBasket (online grocery) and 1mg (online pharmacy).
Where Will the Funds Be Used?
– BigBasket (₹8,500 crore): The money will help expand scheduled and instant grocery delivery services.
– 1mg (₹2,550 crore): The funds will be used to grow the online pharmacy and digital healthcare business.
How Will Tata Raise the Money?
Tata has hired global investment banks Citi and Moelis to find investors. The company is likely to approach:
– Canadian pension funds
– Asian sovereign funds (like Temasek)
– Investors with no competing interests in retail
Current Financial Performance (FY24)
BigBasket
– Revenue: ₹10,062 crore
– Loss: ₹1,415 crore
– Last valuation (2022): ₹27,200 crore (~$3.2 billion)
– Major shareholders: Tata Digital (65%), Mirae Asset, CDC Group
1mg
– Revenue: ₹1,968 crore
– Loss: ₹313 crore
– Last valuation (2022): ₹11,050 crore (~$1.3 billion)
– Major shareholders: Tata Digital (63%), Sequoia, Intel Capital, Omidyar Network, Bill & Melinda Gates Foundation
Quick Commerce Market in India
– 7 major players operate in this space.
– 80% of sales come from India’s top 20–25 cities.
– Market growth projections:
- 2025: ₹45,900 crore (~$5.4 billion)
- 2029: ₹85,000 crore (~$10 billion)
– Expected users by 2029: 61 million
Why Is Tata Raising Funds Now?
With rising competition from rivals like Blinkit (Zomato), Swiggy Instamart, and Zepto, Tata wants to scale BigBasket’s quick commerce and 1mg’s digital health services. The fresh funds will help both businesses grow faster and improve their market share.
If successful, this fundraising will help Tata Digital compete more aggressively in India’s booming online grocery and pharmacy sectors. However, both BigBasket and 1mg are still loss-making, so profitability remains a challenge.