Tata Digital, a digital subsidiary of Tata Sons, is on an acquisition spree. The company is not only acquiring the startups, but it is also welcoming its workforce to join the digital journey with Tata. For example, a recent acquisition of Cult.Fit was more important for Tata Digital due to its founder Mukesh Bansal collaboration with Tata.
Let’s have a look at current acquisitions by Tata Digital and their impact on the digital consumer industry.
Current Acquisitions by Tata Digital and Why it is Important?
The online pharma industry is booming due to the demands of online medicines delivery and medical equipment. NetMeds, PharmEasy, and 1mg are the three major players in the online medicine delivery ecosystem.
Tata Digital has acquired 1mg on June 10, 2021. The company did not reveal the financial details but as per earlier reports, Tata had plans to invest $110 million in acquiring a 65% stake of 1mg.
Talking about the acquisition of 1mg, Tata Digital said:
“Its investment in 1mg is in line with the giant’s “vision of creating a digital ecosystem which addresses the consumer needs across categories in a unified manner.”
Prashant Tandon, co-founder, and chief executive of 1mg are also quite happy with the collaboration with Tata Digital. Talking about the partnership, he said:
“We are delighted to join hands with one of India’s most iconic and respected conglomerates,” said, in a statement. This marks a significant milestone in 1mg’s journey to make high-quality healthcare products and services accessible to customers across India.”
Why 1mg Acquisition is Important?
Currently, Tata Digital is directly competing with Reliance Retails to capture the maximum market in India. Reliance already acquired NetMeds. With the current deal, Tata Digital is one step ahead of Reliance since 1mg has more market coverage than NetMeds.
On the other hand, PharmEasy has become the largest online medicine delivery system in India after acquiring Medlife. The startup has also acquired Thyrocare to strengthen its operations further.
Tata Digital has invested $75 million in Cult. Fit to collaborate with the rising fitness startup. It is one of the major strategic moves executed by Tata. The firm is more enthusiastic to welcome Cult.Fit founder Mukesh Bansal on board. He is a well-known digital entrepreneur. Mukesh also co-founded Myntra that was later acquired by Flipkart.
Mukesh Bansal will not only continue leading Cult.Fit but he is also the executive President of Tata Digital.
Tata Sons Chairman N Chandrasekaran has high expectations from Mukesh Bansal due to his experience in the digital consumer field. Talking about the same, Chandrasekaran said:
“We are delighted to have Mukesh Bansal as a part of the key leadership team of Tata Digital. With his deep consumer experience and an entrepreneurial mindset of having incubated and grown two very successful businesses, his expertise will bring immense value to us.”
Why Cult.Fit Investment is Important?
First of all, Cult.Fit is the leading online fitness startup in India. So, it will make Tata Digital the leader in the online fitness ecosystem.
Second, Tata Digital has strengthened its digital operations by welcoming Mukesh Bansal on board. His experience will help Tata Digital to get success in its dreamy super app project.
Tata Digital was in talks with BigBasket for a long time to acquire a majority stake. Finally, Tata Digital has bought a 68% stake in BigBasket. The deal was closed in February 2021. As per TechCrunch report, Tata invested $1.8 billion to $2 billion to acquire the majority stake.
BigBasket is the largest online grocery delivery startup in India. Grofers and JioMart are the other players in the online grocery ecosystem.
Why BigBasket is a Right Move for Tata Digital?
In the online grocery market, Tata Digital has accelerated its operations by acquiring BigBasket. The company is competing with Reliance’s JioMart, Amazon Pantry, and Grofers.
Due to the recent growth in the online grocery market due to Covid-19, it is one of the strongest moves. BigBasket has made Tata Digital the leader in the online grocery industry.
Overall, the Indian digital consumer market is seeing a triangular competition among Reliance, Tata, and Amazon. All three business giants are leaving no stone unturned to create their monopoly.
The aggressive expansion by Tata Digital through acquisitions has left the other two competitors behind. Tata Digital is on the way to launch its Super App project. Under that app, it will bring all major business sectors together.
But, this is not the end of the competition. It will be interesting to see the future move of Amazon and Reliance.