Where will be BigBasket after 1 year?

.Ambani Went for Future Retail and Tata Smashes With Big Basket.

Hey All, Welcome back to another blog where we are going to discuss Complete detail about Tata and BigBasket Deal.

So let's start the main article:

Main Body:-

All of us know that in India, the Grocery Segment is not much available online or you can say it does not rely on online completely, But still, the current Grocery segment's 50% is in Big Basket's hand, Yes, and Tata Group in advanced talks to buy 80% stake in BigBasket for $1.3bn.

Yup, Tata wants a head-on collision with Reliance in the Grocery sector, If we look at the current valuation of the company through available online resources, it is counted to be $1.6 billion and 80% of that is $1.3 billion which will be held by Tata company if they completed the purchase. 

And the diversity of existing investors are:  

Other Key Investors in BigBasket 

Of course, If you have a little bit of knowledge of how stocks work out then you will be able to know that This is not an easy deal to pull off with so many investors involved.

It is expected that China's internet giant Alibaba, holding around a 29% stake in BigBasket, is expected to sell its entire shareholding. 

So, We can say that according to the proposal, the Tata group is likely to buy 50-60% from existing investors, including Chinese retail giant Alibaba and a few other key investors. 

And Remaining, Tata group will infuse fresh money into BigBasket by buying new shares of about 20-30% of BigBasket. 

A complete stake of 80%.

Mass ownership will be moved from China's hand to India's hand, Tata for a very long time has a strategy that appears to be to establish a beachhead in India's e-commerce market amid a surge in online sales because of covid. 

The main objective of the Tata group is to win a large market share in one shot, and we know that BigBasket is that one option.

And, as we know that BigBasket is already accessed to online platform like it have a BigBasket App and then Tata next move will be to develop a "Super-App" and that Super App will provide an online platform, by adding a wide range of household items and grocery products from BigBasket.

Just think that you will be able to order books, utensils, decorative items, etc. from BigBasket, the platform that distributes food and vegetables currently.

What's The Profit For BigBasket?

BigBasket, The Company that holds a major stake in the Online Grocery Segment in India, You can assume that India's online grocery business valuation in the Year 2020 is over 100 billion Indian Rupees, and out of that more than 50% is BigBasket market's share Why would it suddenly share its major shares with Tata, the first and foremost reason is the fight of Reliance that is trying to enter through JioMart and Future Retail Takeover,

So, To prevent that BigBasket thinks that Tata is able to fight head-on with Reliance, Like remember 4 or 5 years ago there was a massive discount given on the Internet and Telecom segment of India through Reliance Jio, So, If the same occurs in Grocery segment later on then BigBasket can also counterplay and make some profit while other will be in loss.

BigBasket's Revenue Year by Year is Increasing but understand that Revenue includes expenses too and if we are talking about loss then Company's loss in 2019 is 348 crore and in the year 2020, it was 920 crore.

So, It is clear from this point that capital is needed now, which will be available when Tata will hold their share.

More Coming:-

This Bengaluru-based online grocery firm gets around 3,00,000 orders daily, It was valued at $1.23 billion in March.

Now, After the Covid situation, Online Grocery in India is tremendously increasing as people believe that shopping online is better as it will avoid physical contact due to fear of covid.

The valuation currently is $1.6 billion, still, there is a huge market to capture, no company still has made major change or reform in India's Grocery scene.

You can imagine that India's Grocery business both offline and online is nearly $500 billion and just 2 or 3 billion dollars is an online business, So there is a huge opportunity for Current MNCs and for those too who want to do a start-up.

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I hope that whatever the future may be, we will cover and rise together, Stay safe and sound, We'll meet in the next Blog  BBYe.

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