Tata Digital to be the conglomerate’s sole e-commerce venture: Report
The Tata group will transfer the holdings of Tata UniStore, which runs Tata Cliq, to Tata Digital, making it the sole entity for all online shopping ventures, a report in the Economic Times (ET) said.
Last week, the conglomerate increased Tata Digital’s authorised capital to Rs 21,000 crore from Rs 20,000 crore and infused Rs 750 crore. It was done to repay debt and expand the business. In September, the authorised capital of the company was raised from Rs 15,000 crore to Rs 20,000. In March, the share capital was increased from Rs 11,000 crore to Rs 15,000 crore.
Tata UniStore was jointly owned by Tata Industries and Trent. It has been valued at Rs 750 crore and Tata Digital will offer preference shares to Tata Industries and Trent.
“There are very few Tata businesses where funding has been deployed at such a war-footing and it shows where the group’s priorities lie,” Mohit Yadav, founder of business intelligence firm AltInfo, told ET.
Tata Digital will compete with Amazon, Walmart-owned Flipkart and Myntra, and Reliance Industries in the Indian e-commerce space.
ET said the Tata group is driving a price war with its rivals, with discounts offered by it in categories like smartphones, electronics or fashion.
However, it is also burning money like its rivals. In FY22, Tata UniStore’s net loss more than doubled to Rs 750 crore despite a 137 per cent rise in its revenue.
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