Grocery delivery company Bigbasket confirmed on Friday that it has raised $300 million (roughly Rs. 1,900 crore) in a round led by Chinese e-commerce company Alibaba. This is a move that's been in the offing for some time now - Alibaba and Paytm were said to be in talks with BigBasket six months ago - although at the time the size of the round was believed to be $200 million (roughly Rs. 1,300 crore).
On Friday, Bigbasket confirmed that it has raised $300 million in a round led by Alibaba and other investors. It also added that it has signed Bollywood superstar Shah Rukh Khan as brand ambassador for the third year in a row.
"Bigbasket is delighted to receive this funding from Alibaba, which will essentially be directed towards growth and consolidation," said Hari Menon, CEO and co-founder, Bigbasket. "The multinational e-commerce retailer fits in best with what we believe in. The funds will be directed towards bettering our technological, analytical, and infrastructural prowess, all of which will enable the company to move up the curve."
"Bigbasket is currently partnering with about 1,800 farmers throughout the country and aims to become the ‘most preferred partner’ for up to 3,000 of them," Menon added. "While we already enjoy the appreciation and trust of ‘bigbasketeers', our strategy is to eventually become the one-stop-shop for all customer needs in future."
According to the company, it has no plans to expand its offering to more cities at the moment. Instead the focus will be to deepen its operations in the 30 cities it is already active in. It's also planning to step up hiring blue collar workers - the current employee strength is 16,000 people, and the company plans to increase this.
Bigbasket said that its monthly run rate is Rs. 200 crore, and added that India’s retail market is worth over $900 billion, and grocery shopping accounts for about $600 billion of that. It's therefore not surprising to see other companies being active in this space as well.
Amazon, which in June acquired specialty grocer Whole Foods Market Inc in the US, also got the government's nod to invest $500 million (roughly Rs. 3,200 crore) into food retailing in India in July last year, and has been expanding its Amazon Now offering, and has opened its own Now Store for fulfilling grocery orders.
Other players in the space include Grofers, which received a clearance for FDI of $25 million (roughly Rs. 160 crore). Flipkart has also said that it will be re-entering the grocery segment, which it had pulled out of nearly two years ago.