What will Big Basket gain through the deal with Tata?
Big Basket has the largest market share in the Indian Online Grocery Shopping Business. It saw a tremendous rise in its number of customer in the Covid period.
With the entry of Jio Mart, the market has turned hyper competitive due to the strong backing of Reliance following the strategy of deep discounts. Jio Mart started catching upto Big Basket within a few months of its launch.
Big Basket in an effort to maintain its position of the market leader and to backfire at Reliance Industries Pvt Ltd. has sought this deal with Tata.
The deal will bring Big Basket the deep pockets of the Tata’s, experience in scaling up business and the industry name.
What’ s in it for Tata?
Tata’s will gain a majority share in India’s online grocery business thereby increasing their digital presence as the conglomerate is sensing a high growth in the e-commerce industry post Covid scenario.
The deal will help the launch of their “Super-app” which will give the consumers a single point of access for all services such as online fashion, groceries, medicines etc and bring all their consumer businesses under one roof for which the company is also planning to acquire stakes in the online pharmacy business 1mg.
Tata will be acquiring existing shares. This will lead to an exit of Alibaba which has backed the start-up through many rounds of funding and Abiraaj Group, both of which are the major stakeholders along with partail exit of some small stakeholders.
