Paytm Mall, Alibaba backed eCommerce venture is in talks to buy a stake in BigBasket. The online marketplace is likely to invest approx ₹1,300 crore in the Bengaluru-based company. This deal will help Paytm Mall to strengthen its online-to-offline strategy. When asked, Paytm’s spokesperson declined to comment on this matter while BigBasket co-founder, Hari Menon clearly denied Paytm Mall’s investment in the company.
Paytm Mall has shown interest in purchasing the stake in BigBasket, as the online grocery store is exploring various strategic options, which includes the sale to Amazon and a merger with Grofers. Apart from that, Bigbasket has been discussing a fundraising from financial investors as well.
BigBasket’s discussions with Amazon India have been on hold as the two sides have not been able to agree on various issues, including valuation. BigBasket is seeking a valuation of about ₹6450 crore for the company. Investment bank Morgan Stanley is advising BigBasket in these discussions.
In order to compete with the Flipkart, these e-commerce giants are seeking to take on food and grocery segment as it makes up approx. ₹1.5 lakh crore of approx. ₹4 lakh crore retail market opportunity in the country.
BigBasket’s private labels including Fresho for fruits and vegetables and Happychef for gourmet foods accounted for over one-third of its sales. The company registered about ₹1,400 crore in revenue in the fiscal year 2017.