Tata Sons is not too pleased with what it sees as BigBasket's tardy response to the quick commerce sector's explosive growth and widespread adoption. It calls this a strategic misstep that has caused the Tata Digital division to lag behind competitors Blinkit and Zepto.
Seeking $ 1 Billion Funding
According to the report, which cited a person with an understanding of Tata Digital's intentions, Tata Sons pushed back on taking the lead in BigBasket's projected $1 billion in funding.
In order to recover market share lost to rivals, Tata Sons is said to have discussed with BigBasket management the possibility of onboarding a financial investor and obtaining up to $1 billion (about Rs 10,000 crore) from outside investors.
The performance of Tata Digital's Neu superapp has fallen short of expectations despite Tata Sons having committed more than $2 billion in it to date. After stating unequivocally that companies must demonstrate returns and that unrestricted investments will not be made, N Chandrasekaran, the chairman of Tata Sons, is reportedly looking for accountability.
Possible IPO in the Works
One of BigBasket's most exciting aspects is that this potential funding round would pave the way for the company to go public on its own. According to someone with knowledge of the matter, "Basically, this (funding) could lead to an IPO independently for BigBasket."
This might provide BigBasket with a stronger competitive advantage and enable it to receive future funding through the public market if properly implemented.
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Future Expansion Plans for BigBasket
BigBasket is making slow progress, but it has big aspirations for 2025. Hari Menon, the firm's CEO and co-founder, has previously said that the company plans to start its quick food delivery service next year in order to compete with Zepto Café, Blinkit's Bistro, and Swiggy's Bolt.
Menon outlined BigBasket’s expansion plans in a post on X (formerly Twitter):
BigBasket might yet be able to reclaim lost ground if it can carry out these strategies and obtain new investments. However, it faces an uphill battle against well-established rivals that have already captured the market share in the quick commerce space.
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