Tata Digital's revenue jumped 13X in FY23; losses widened at a slower pace

Tata Digital operates Tata Neu, which is the company’s everything app for its e-commerce ambitions.

Tata Digital, the conglomerate’s e-commerce project, grew in scale and registered revenues of Rs 204.35 crore in FY23, a 13X jump from Rs 15.9 crore that it clocked in FY22. Although loses mounted up it was at a slower pace.

Tata Digital’s losses stood at Rs 1,370 crore, which was 22 percent more than Rs 1,123 crore that it incurred in FY22. These financials do not include the performance of its key subsidiaries like BigBasket, Croma, 1mg and others.

Tata Digital operates Tata Neu, which is the company’s everything app for its e-commerce ambitions. Under the Neu app, customers can also avail of services from BigBasket, 1mg, Croma and others, all of which are subsidiaries of Tata Digital. While Neu had teething troubles initially, it has made progress by improving the user experience (UX) but still has a long way to go.

With Tata Neu, the company looks to take on Reliance, Adani and other players with deep pockets and want to set up a super app, too. Tata has been ramping up its e-commerce play and has so far invested Rs 18,943 crore into Tata Digital alone, as per Tata Sons’ annual report released on August 9.

BigBasket

BigBasket, the group’s e-grocery wing saw its revenues jump about 30 percent from Rs 7,462.2 crore in FY22 to a total of Rs 9,695.7 crore in FY23. BigBasket’s revenues were split between Supermarket Grocery Supplies (the B2B arm) and Innovative Retail Concepts (the B2C arm). While B2B’s revenues accounted for Rs 2,261.3 crore, B2C’s revenue share was much larger at Rs 7,434.4 crore.

Since the B2C play is larger in size, it meant that the division’s share of losses also outsized that of the B2B unit. In all, BigBasket incurred a loss of Rs 1,750 crore in FY23 nearly double of Rs 896 crore that it incurred in FY22. A split showed that BigBasket lost Rs 1,535.2 crore through B2C and Rs 215.2 crore via B2B in FY23.

BigBasket competes with SoftBank-backed Swiggy Instamart, Y Combinator-funded Zepto, Reliance-backed Dunzo and Zomato-owned Blinkit, all of which are deep in losses.

Tata 1mg

Even Tata 1mg, the group’s e-pharmacy bet, saw its revenue increase by over 3X from around Rs 544 crore in FY22 to about Rs 1,685 crore in FY23, the annual report showed. While Tata owns 100 percent in Tata 1mg Healthcare Solutions but owns a 63.55 percent stake in Tata 1mg Technologies.

The e-pharmacies losses, however, jumped largely in tandem with revenues. In FY22, Tata 1mg incurred a loss of around Rs 486.9 crore, which jumped 160 percent to Rs 1,261.9 crore.

For Tata 1mg, which competes with Pharmeasy, Netmeds and others, costs are likely to remain elevated in FY24 also as it looks to increase its store count to 200-300 outlets by the end of this calendar year, which is a 4-5X jump from its current offline footprint, Moneycontrol had reported earlier.

Tata Cliq 

Similarly, Tata also operates Tata Cliq, its e-commerce app that competes with Walmart’s Myntra, Reliance’s Ajio, Nykaa and several others but in a smaller in scale.

Tata Cliq generated a revenue of Rs 78.5 crore in FY23 and incurred losses of Rs 175.5 crore. Comparable numbers for Tata Cliq were not available for FY22, Tata Sons’ annual report showed. Tata recently roped in Gopal Asthana to lead Cliq.

Asthana previously worked at Nykaa as Chief Business Officer of Nykaa Fashion. The Falguni Nayar-led company has seen several senior executives depart this year amid a more challenging environment as other players like Reliance and Tata enter the space.

Croma

Croma was Tata Digital’s biggest division in terms of revenue in FY23. Croma registered a revenue of Rs 15,851 crore in FY23, which was nearly double of Rs 8,207 crore that the electronic appliances retailer clocked in FY22.

Its losses, however, jumped from Rs 445 crore in FY22 to Rs 957 crore in FY23, the annual report added. Like most other departments, Tata’s Croma competes with Reliance Digital.

Disclaimer: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.