tata sons: Tatas replenish ecommerce war chest with Rs 5,882 crore

Kolkata: Tata Sons has infused Rs 5,882 crore into its flagship ecommerce entity Tata Digital, regulatory filings showed, the highest ever fund allocation in a single tranche and the most that the Tatas have invested into ecommerce in any single fiscal year.

Tata Digital, which owns the newly launched ecommerce super app Tata Neu, has over the last year been undertaking acquisitions in the consumer internet space, snapping up buzzy startups such as e-grocer BigBasket and e-pharmacy 1mg.

The latest funding takes the total investment into Tata Digital to Rs 11,872 crore in 2021-22, helping it achieve a war chest to take on established ecommerce rivals Amazon and Walmart-owned Flipkart in the country.

The board of Tata Digital on March 30 approved the allotment of 5.88 billion fully paid-up equity shares of Rs 10 each on a rights basis, aggregating to Rs 5,882 crore, to Tata Sons, the holding entity of Tata Digital, filings to the Registrar of Companies (RoC) showed. The RoC filings were made on Thursday when Tata Neu went live, indicating the group is gearing up to take on well-entrenched players like Amazon, Flipkart and newer, but well-funded, entrant JioMart from the RIL stable.

Tata Digital, which is also the holding entity for the group’s electronics retail chain Croma, had received Rs 5,990 crore from Tata Sons in the nine months till December of 2021-22 in multiple tranches, according to the filings.

Tata Digital and Tata Sons did not respond to ET’s emails till press time Friday.

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On March 23, the filings showed, Tata Digital increased its authorised share capital to Rs 15,000 crore from Rs 11,000 crore to set the stage for the current round of capital infusion.

Tata Digital said in the filings that its authorised share capital had been increased to repay part of its existing debt, meet business activities and other corporate requirements.

“Tatas’ massive infusion of Rs 5,882 crore in one single tranche is almost half of the capital infused into the company since inception,” said Mohit Yadav, founder of business intelligence firm AltInfo. “It acts as a signal to other deep-pocketed players that Tatas are fighting this e-commerce war to win, and the costs involved will not be a hindrance in pursuing this goal.”

The increase in authorised share capital shows that more such infusions are possible in the foreseeable future, Yadav added.

According to the RoC filings, Tata Digital had raised Rs 400 crore in FY21 and Rs 100 crore in FY20 from Tata Sons.

Tata UniStore Ltd, which owns the Tata Cliq ecommerce platform, raised Rs 102 crore in FY22, Rs 30 crore in FY21, Rs 311 crore in FY20, Rs 292 crore in FY19 and Rs 224 crore in FY18, as per the filings.

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Divyansh Singh

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