Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

India's Tata gets bullish on e-commerce just as rules threaten to transform market

Stock MarketsJul 22, 2021 03:45AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: A private security guard stands at the exit gate of the headquarters of Tata Consultancy Services (TCS) in Mumbai, India, Oct. 13, 2016. REUTERS/Shailesh Andrade

By Aditya Kalra and Abhirup Roy

NEW DELHI (Reuters) - India's Tata Group is taking a more vocal interest in rules shaping online marketplaces, hinting at ambitions as it reappraises its retail strategy just as e-commerce reform threatens to muddy plans.

The $106 billion conglomerate yet e-commerce minnow was far more vociferous in discussions than market leader Inc (NASDAQ:AMZN) at a July 3 meeting with government officials about proposals such as the prohibition of sales of own-brand or affiliates' goods, attendees said.

The rules would greatly increase the compliance burden of a conglomerate's numerous entities and interests, and hurt them far more than smaller rivals, Tata Vice President Poornima Sampath told the online gathering, according to two attendees.

Tata declined to comment for this article. Sampath did not respond to a request for comment.

Two weeks earlier, the government spooked the industry by proposing increased scrutiny of relationships between online marketplace operators and their partners. The plan was widely regarded as an attempt to curb the dominance of Amazon and Walmart (NYSE:WMT) Inc's Flipkart and support high-street shops.

The 153-year-old Tata conglomerate is ubiquitous on Indian high streets, so its voice in favour of e-commerce at the July 3 meeting indicates the degree to which it is changing tack.

The firm is arguably best known internationally as owner of British luxury car brand Jaguar Land Rover, but it also makes cars at home under its own brand. The group is also active in steelmaking, IT outsourcing, and hotel and airline operation.

In retail, Tata has an expansive offline portfolio including a joint venture with cafe operator Starbucks Corp (NASDAQ:SBUX) and stores it operates for Inditex (MC:ITX) fashion brand Zara. Yet it is a minor player online - a situation it is determined to rectify, said five people with direct knowledge of its plans.

It bought the majority of online grocer BigBasket in May for over $1 billion and in June took control of online pharmacy 1mg. They will likely join other marquee brands on an app that Tata aims to pilot this year, said three of the people.

E-commerce is the next big thing for Tata, and with that in mind, it plans to buy many more brands, said one of the people.

None of the sources were authorised to speak publicly so declined to be identified.


Tata's latest digital push is not its first. It launched its Tata CliQ online marketplace in 2016, which booked sales of $36 million in 2019-20. Yet that compared with roughly $10 billion at Amazon, which has invested billions of dollars in India.

Still, in an e-commerce market widely projected to be worth $200 billion by 2026, there is plenty of space for Tata to grow.

Through its app, Tata plans to bring its brands together to offer services such as grocery shopping, meal and medicine delivery, sales of electronic products plus online fitness packages, people familiar with its plans said.

Tata is still developing the app's features and determining a go-to-market strategy, with the launch likely in phases, starting with some large cities, said one of the people.

Another said the pilot could begin as early as September in the southern city of Bengaluru, India's IT hub.

Spearheading the app is Tata Digital Chief Executive Pratik Pal, who gained extensive experience with retailers in 28 years at IT outsourcing unit Tata Consultancy Services Ltd.

Yet digitally integrating the multitude of businesses at a conglomerate the size of Tata Group is a daunting task, said Keyur Majmudar, a managing partner at India's Bay Capital, adding that retaining customers on a super app will be tough when there is a rise in several niche e-commerce players.

"They need a radical shift in thinking. That (digital integration) is something they've never done before. So, the jury is still out," he said.

Pal declined to comment.

Just as Tata's new digital strategy gathers pace with acquisitions and app development, the government has sprung a surprise that may mean a rethink before the app is even piloted.

A ban on marketplaces offering affiliates' products could bar its Croma electronics chain and Starbucks from Tata sites, Sampath said at the July 3 meeting, according to two attendees.

A ban on sales of own-brand goods has also triggered questions about whether it will be able to retail its household names such as Tata Tea or Tata Salt on its e-commerce platform.

The Tata brand name adds a level of assurance for consumers, Sampath objected at the meeting, seeking clarity on the government's policy plans, attendees said.

India's Tata gets bullish on e-commerce just as rules threaten to transform market

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email