Tata Group plans to buy a majority stake in the online grocery seller BigBasket for $1 billion. The company has applied with the Competition Commission of India (CCI). BigBasket is one of the major players in India’s online grocery market. It is backed by Chinese Alibaba Group Holdings Ltd.
India’s online grocery market is growing at a steep pace with the changing lifestyles of young professionals and busier lifestyles. In the year 2020, it was valued at $2.9 billion and many experts predict it will grow at a compound rate of 37.1%. Online delivery of grocery and food items came as a savior for many during the pandemic year when most regions saw a strict lockdown. This added as a catalyst for the growth of online grocery stores in India. And now, the conglomerate wants to mark its presence in the sector.
It would be an interesting as well as a tough pitch for the Tata Sons with players like Amazon, Walmart Flipkart, and Mukesh Ambani’s JioMart. With the news of Tata buying a stake in BigBasket, the big players are expected to spend heavily in the already competitive Indian Groceries market.
Jio has already attracted a $20 billion investment from Facebook and Google while Flipkart is expected to expand its operations in more Indian cities.
Chinese e-commerce giant Alibaba owns a 29% stake in BigBasket for now but is expected to sell the entire stake to Tata in the forthcoming deal. This will confirm the exit of Alibaba Group which was one of the earliest investors of the firm. Additionally, the move will pave the path for the exit of Abraaj Group as well.
Also read:
Tata group will buy a 64.3% stake in the e-grocery firm making it the biggest investor. It is also reported that Tata Group will invest further in the business solidifying its stake. The move comes along with the Super App plan of the group where customers will get access to multiple services through one application.
