Tata Sons set to go big in e-commerce sector and invests Rs 5,882 Cr in Tata Digital

Tata Sons is in the mood to tackle e-commerce and compete with industry giants such as Amazon and Flipkart. According to a report, the business conglomerate has invested an amount of Rs 5,882 crore in its flagship e-commerce company Tata Digital. This is the highest fund allocation ever made by Tata Sons in a single tranche in its e-commerce business in a single fiscal year, the report said.

Overall investment in Tata Digital now stands at Rs 11,872 crore in 2021-22 with the additional funding, helping it to strengthen enough to take on e-commerce rivals like Amazon and Flipkart in India, according to the report. ‘Economic Times citing regulatory filings. According to the publication, it was mentioned in documents filed with the Registrar of Companies (RoC) that Tata Digital’s board gave a nod to “the allotment of 5.88 billion shares entirely released of Rs 10 each on a fee basis”. to Tata Sons, the holding entity of Tata Digital, on March 30 this year. The award resulted in an investment totaling Rs 5,882 crore. This award was made on the day Tata Neu, the company’s all-purpose app, came alive to compete with existing players like Flipkart, Amazon and others in the foray.

“Tata Digital, which is also the holding entity of Croma Group’s electronics retail chain, had received Rs 5,990 crore from Tata Sons in the nine months to December 2021-22 in several tranches” , says the report citing regulatory filings.

“On March 23, according to filings, Tata Digital increased its authorized share capital to Rs 15,000 crore from Rs 11,000 crore to set the stage for the current round of capital injection. Tata Digital said in filings that its authorized share capital has been increased to repay some of its existing debt, meet business operations and other corporate requirements,” the report said.

The increase in authorized capital proves that the Tatas are in the war to win and there is a possibility of more such investments in the foreseeable future, experts say. According to RoC filings, Tata Digital had raised Rs 400 crore in FY21 and Rs 100 crore in FY20 from Tata Sons, according to the report. On the other hand, Tata Cliq platform owner Tata UniStore Ltd raised Rs 102 crore in FY22, Rs 30 crore in FY21, Rs 311 crore in FY20, Rs 292 crore in FY19 and Rs 224 crore in FY18 , according to the deposits.

The Tata Group recently went public with its plans to make a name for itself in e-commerce with the launch of its super app Tata Neu. The app allows users to access a number of platforms such as Air Asia, BigBasket, Croma, IHCL, Qmin, Starbucks, Tata 1Mg, Tata CLiQ, Tata Play and Westside, as well as other company-owned platforms.

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