Tata Invests Rs 5882 Crore Into Ecommerce App Tata Neu To Fight Amazon, Flipkart; Total Rs 11,872 Crore Spent!
Tata Sons has invested Rs 5,882 crore in its ecommerce company Tata Digital (TD), the most it has invested in ecommerce in any single fiscal year.
This is also the highest ever fund allocation in a single tranche.
The overall investment into TD in 2021-22 now amounts to Rs 11,872 crore, which will help it take on established online retailer rivals Amazon and Flipkart.
TD has been busy making acquisitions in the consumer internet space over the last year.
It took over major startups such as Bigbasket and e pharmacy 1mg.
Gearing Up For Tough Fight
The board of TD on March 30 approved the allotment of 5.88 billion fully paid-up equity shares of Rs 10 each on a rights basis according to filings to the Registrar of Companies.
The filings were made when the superapp Tata Neu went live, indicating that the group is preparing to take on established players like Amazon, Flipkart and new but well funded entrant Jiomart.
The filings also show that TD has raised its authorised share capital to Rs 15k crore from Rs 11k crore, setting the stage for the current round of capital infusion.
Experts say that this massive infusion in a single tranche sends the message to other players that Tata is in the ecommerce fight to win.
The costs involved are no bar.
In fact, more such infusions can be expected in the near future.
This has been raised in order to repay some of its existing debt, meet business activities along with other corporate requirements.
Tata recently launched its much awaited super app Tata Neu in which users can shop from various Tata brands in a one stop destination.
Some of the brands onboarded include Air Asia, BigBasket, Croma, IHCL, Qmin, Starbucks, Tata 1Mg, Tata CLiQ, Tata Play, and Westside.