Tata Group in an acquisition frenzy
India’s largest conglomerate and amongst the most renowned business groups in the world, the Tata Group, is on an acquisition spree, for a variety of reasons. There is hardly any sector or industry, where the business giant hasn’t made any purchases. Insider sources state that one of the main targets, behind such purchases, is that of diversification. If we look back at the last one hundred fifty years, when the patron of the Tata group, Jamshedji Tata, started his journey, from his iron and steel plant in Jamshedpur, which later came to be known as the Tata Iron and Steel Company, the group has made immense strides.
It is mindboggling to know, that in 2020, the total valuation of the Tata Group, is around 106 billion dollars and, the employee headcount is more than seven lakhs. The largest employer in India, the Indian Railways, is around 1.3 million. The firm is present across all verticals such as groceries, fashion, electronics, travel, beauty, education, fitness, and health and entertainment respectively. For accomplishing this objective, the TATA group is creating its app, which will work as an e-commerce app in all the sectors of the company. The company, which is in charge of making this app, is Tata Digital. Tata Digital is creating the super app, which will fulfill all its requirements.
To create this exceptional app, Tata Digital is now seeking to purchase Curefit, which is a famous fitness and health app. This occurred after the Tata Group has bought pharmacy app 1 mg and Big Basket. As per the chairman of the Tata Group, N Chandrasekaran, they will be diversifying and adding all the categories, in a step-by-step manner, and not instantly. Chandrasekaran told Business Times, that in a candid interview, that the brilliant app would have an open architecture. This implies, that the app will have a payments engine, strong loyalty program, financial products, and various categories.
Currently, the TATA group is planning to integrate the potential of its fashion retail firms like Infinity Retail and Trent. The firm is now planning to indulge in the manufacturing of electronics, by establishing a new firm known as Tata Electronics. Tata Electronics is planning to make high-end technology products in Madras in Tamil Nadu respectively. It was rumored, that Tata Electronics collaborated with the American giant Apple Inc, for building iPhones. It is stated that Tata Electronics, along with other group companies, such as Voltas and Titan, will back the high-end app.
One major development is that Tata Consumer Products will lead the Fast-Moving Consumer Goods and grocery segment, along with Big Basket. The conglomerate will add travel, hospitality services, and financial products to the future app, with the help of TATA AIG, TATA AIA, Taj Hotels, Vistara, and TATA Capital respectively.
Before all these initiatives, for the amazing app, the erstwhile Chairman of the Tata Group, Ratan Tata, had made an investment of three million dollars in Curefit, with the assistance of the UC RNT fund. UC RNT fund is nothing but a joint venture between University of California investments and Ratan Tata. This company was established in 2016. This app raised 418 million dollars in funding and its latest valuation was supposed to be 800 million dollars. All, the leading Venture Capitalists, such as Kalaari Capital, Accel, and Temasek, are among the top investors in Curefit.
However, TATA Group is already doing a lot of activity, in Mergers and acquisitions, such as purchasing a 64percent share in the giant retail group, which owns Big Basket, namely, Supermarket Grocery Supplies, by its subsidiary company, TATA Digital. TATA Digital has injected two hundred million dollars of hot money, into Supermarket Grocery Supplies, at a valuation of two billion dollars.
As per industry insiders, the super app of the TATA group will face extreme competition from other industry giants, such as Walmart, Amazon, and JioMart. For making very large product portfolios, TATAs will include external firms, from other groups, into their super app. It is estimated, that the app from the TATA Group, will ultimately defeat its rivals, due to its longstanding reputation and historical significance. Also, TATAs are supposed to treat their employees and customers as an asset and give an excellent service and lifetime experience.