Japan's SoftBank Vision Fund (SVF), Tiger Global and Sequoia Capital have pumped in around $60 million in fresh capital in the online grocery delivery startup, Grofers, pushing its valuation to $425 million, according to a report by The Financial Express.
The fundraising is a part of the Gurgaon-based firm’s new Series F financing round, where the company is stitching together about $120-140 million funding round.
According to the report, SoftBank invested $37.49 million in Grofers, Tiger Global pumped in $19.99 million, while Sequoia Capital injected $1.99 million in the startup. The latest round of funding has pushed the company's valuation to $425 million, according to estimates from business intelligence platform Paper.vc.
Read: Grofers partners with local businesses for last mile delivery
The latest funding would help Grofers continue its expansion into the fast-moving consumer goods (FMGC) segment, as per the report. The company is said to have been banking on its FMCG private labels to drive its second phase of growth.
Grofers has been putting together a strategy to make cheaper consumer goods available to the masses. "There are logistics and storage costs involved in transporting goods from the manufacturers to the wholesaler and then to the retailer. All of that goes away in our case," founder Saurabh Kumar had told the paper earlier.
Analysts say the online FMCG segment has the potential to grow given its low penetration at present.
On the other hand, competition in the online grocery delivery space has been building up with Swiggy launching Stores to deliver groceries to doorsteps and BigBasket looking to raise new $150 million round, which may value the company at $1 billion.
Read: Swiggy moves beyond food delivery, launches Stores to deliver everyday needs
Online retail giants Amazon and Flipkart-owned Walmart too are making their entry in the online grocery delivery market. However, as of now, they remain relatively small in comparison to leader BigBasket.
In the year that ended March 2018, Grofers narrowed its losses to Rs 258.30 crore from losses of Rs 268.32 crore posted in FY17, data sourced from business intelligence platform Tofler showed. Operating losses fell to Rs 88 crore from Rs 129 crore. Revenue from operations jumped 125 percent to Rs 29.83 crore in FY18 from Rs 13.23 crore reported in the previous year, the data showed.Read: Grofers eyes over Rs 2,500-cr revenue in FY19