Bengaluru-based e-grocer BigBasket has reported revenues of Rs 1,090 crore in FY17, which shows a 107% jump from Rs 527 crore in the previous fiscal. Meanwhile, losses increased to Rs 191 crore last fiscal, compared to Rs 103.4 crore in FY16.
BigBasket has two operating entities. Supermarket Groceries sources products from companies and sells them to Innovative Retail, which in turn runs the consumer-facing portal and makes the last-mile delivery to comply with the norms on foreign direct investment (FDI) in direct online retail.
“With fill rates and on-time delivery over 99%, our performance is the best even among global retailers. We have invested heavily in marketing and creating an infrastructure to help maintain our focus on customer experience,” said Hari Menon, founder BigBasket.
BigBasket, which claims to have achieved break-even in Bengaluru and Hyderabad in the last fiscal, hopes to close the current fiscal with sales of over Rs 2,000 crore.
Recent development in BigBasket and e-grocery in India
Earlier, this month, Chinese e-commerce giant Alibaba Group Holding, which is going to acquire a stake in the e-grocer, had got approval from the CCI (Competition Commission of India).
Alibaba and BigBasket are in talks to square a deal of over $300 million which could be materialised in the coming days. According to the report, Paytm Mall is also likely to invest in BigBasket as part of the deal and will hold about 35-40% stake in the grocery etailer along with Alibaba.
In October this year, the e-grocer picked up two rounds of investments. The online grocery firm raised Rs 52 crore from its four existing investors, including UAE-based Abraaj Basket, Bessemer Venture Partners along with International Finance Corp and Sands Capital. The funding came on the back of raising another Rs 38 crore in two tranches from Helion Ventures and Trifecta Venture in the same month.
Last month, Flipkart launched its grocery delivery service under the brand name ‘Supermart’ in Bengaluru. It is the second time Flipkart has entered grocery and FMCG segment.
Flipkart’s rival Amazon India also launched its grocery ordering app, Amazon Now in February 2015. As per Kalagato, a data tracker platform, Amazon had about 31.2% market share in March 2017. Amazon delivers grocery in four cities – Mumbai, Bengaluru, Hyderabad and Delhi.
In an earlier interview with Entrackr Grofer’s founder, Albinder Dhinsda said that Bigbasket is primarily catering to premium customers while we are going after mass market. Unlike Bigbasket, Grofers is building high frequency with low average basket size. Highlighting the fact that Grofers keeps inventory for more than 10 days while Bigbasket holds inventory for about four weeks.
The investors in the country are betting that the sector will turn into a multi-billion dollar category over the next few years. E-grocery sales are forecast to reach $1 billion in 2017, according to market research firm RedSeer Consulting Pvt. Ltd.
The development was reported by ET.