Tata buys majority stake in India's BigBasket

Financial terms were not disclosed. Local media outlets citing regulatory filings have noted Tata is taking a 64% stake and had separately committed about $219 million to the company last week. Alibaba and private equity firm Actis are fully exiting their positions, according to Mint.

Alibaba, BigBasket’s largest shareholder, held a 26.3% interest. It joined an approximately $150 million round in 2019 alongside Korea’s Mirae Asset Management and UK development finance institution CDC Group.

It comes as sentiment for Chinese backing cools in India’s start-up ecosystem. Alibaba is known to have sat on the sidelines in recent months as some of its key portfolio companies in the country raised large growth rounds, among them restaurant food delivery app Zomato and e-commerce delivery provider Xpressbees.

Tata is investing via Tata Digital, which launched in 2019 with a view to growing consumer-centric businesses across verticals including retail, travel, and financial services. The conglomerate said in a statement that the food and beverage category is an important part of its plan to create a digital consumer ecosystem addressing consumer needs across these sectors.

Founded in 2011, BigBasket is one of the leaders in India’s competitive online grocery space, handling about 15 million customer orders a month across 30 cities. The company offers access to more than 50,000 stock-keeping units and services such as home delivery on preferred dates and time slots.

BigBasket seeks to differentiate itself through supply chain integration and offerings such as a farm-to-fork service that connects some 12,000 farmers to end-consumers via a small network of collection centers. The company claimed to generate $1 billion in revenue last year.

Previous backers also include TR Capital, Bessemer Venture Partners, Sands Capital, Ascent Capital, and venture debt specialist Trifecta Capital which invested as recently as last year.

Bigbasket’s biggest competitor is Grofers, which raised a $200 million round led by SoftBank Vision Fund in 2019 and has been valued recently at nearly $1 billion. Grofers originally pursued a high-cost hyperlocal model focused on delivering small items from local shops to consumers before pivoting to an inventory-led model in 2016.

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• Topics
• South Asia
• Consumer
• Buyouts
• Trade sale
• India
• Alibaba Group
• Actis Capital
• TMT
• Food
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• e-commerce