Tata Group is preparing for a major investment push to strengthen the key digital ventures – BigBasket (quick commerce platform) and Tata 1mg (digital healthcare provider). This is a strategic move to bolster the quick commerce and e-health sectors. Both these sectors are rapidly growing in the Indian market and the competition is intensifying. Therefore the group is planning to invest 1.3 billion to boost the growth of these two ventures.
The global investment banks like Citi and Moelis & Company will be helping the ventures to get funds from external sources. Out of the total target, $1 billion will be invested in the quick commerce platform, Bigbasket. This quick commerce needs modification and ramp-up the game to compete with companies like Zepto and Blinkit.
The remaining amount, $300 million will be poured to build 1mg. This fund will be used to scale the online pharmacy and healthcare services. Already, Zepto has started its online pharmacy delivery and brought it into the quick commerce section. A surge in digital health solutions is seen in the urban and semi-urban areas of India.
The controlling stake is held by TATA SONS LIMITED via Tata Digital. The company already invested over $2 billion in the digital ecosystem. The multi-purpose super-app, Tata Neu has not performed well as per expectations, leading to reassessment of the digital priorities. Therefore, the focus is now shifted to creating these two ventures strong and established in the market.
In the recent years, BigBasket has served a major share of Tata Digital. Upto 420 crore in revenue in FY24 as compared to last fiscal year. 1mg was valued at around $1.25 billion in the previous funding round in 2022. The Tata Group has a controlling stake of 65% of BigBasket, where they hold 63% of 1mg.
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