Home Business Tata Digital in initial talks with Just Dial for e-commerce play, Marketing & Advertising News, ET BrandEquity

Tata Digital in initial talks with Just Dial for e-commerce play, Marketing & Advertising News, ET BrandEquity

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Tata Digital in initial talks with Just Dial for e-commerce play, Marketing & Advertising News, ET BrandEquity

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Tata Digital has held talks with multiple partners as it hurries to finalise its 'Super App' aimed at taking on the likes of Reliance and Amazon in India's e-commerce space.
Tata Digital has held talks with multiple partners as it hurries to finalise its ‘Super App’ aimed at taking on the likes of Reliance and Amazon in India’s e-commerce space.

Tata Digital, the digital arm of the salt-to-software services conglomerate, has held exploratory talks with Just Dial, an online search engine for local businesses, to strike a strategic alliance or pick up stake, as part of the Mumbai-based group’s push to enter the e-commerce space.

Multiple people in the know of the discussion said on condition of anonymity that an initial round of conversations had taken place, although a final outcome was not imminent.

“Both sides have met for discussions, but it is too early to say anything has been finalised. A lot also depends on how things evolve between the two parties,” said a senior Tata official who was aware of the meeting.

Tata Sons’ mergers and acquisitions team has been creating a list of possible partnerships that they can close to provide Tata Digital that big scaleup and reach needed in the online consumer space.

Tata Sons did not comment when contacted by The Economic Times. An emailed query sent to VSS Mani, founder and managing director at Just Dial, did not elicit a response as of publishing this story.

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Tata Digital has held talks with multiple partners as it hurries to finalise its ‘Super App’ that combines many services and products under a single umbrella, according to the people cited above.

Just Dial started life as a phone-based service in 1996, listing local services on its platform. Having disrupted the traditional classifieds industry, Mani was among the first set of Indian entrepreneurs who tapped the online market. The company went public in 2013 and has a market cap of Rs 5,419.98 crore. But since going public, it has struggled to take on tech heavyweights such as Google and Facebook.

Further, Just Dial has not been able to build a layer on top of its listing services by enabling e-commerce transactions. However, the company is debt-free and profit-making, which is why a tie-up with the Tatas may offer scaleup benefits to both, say group watchers.

Just Dial posted a 38% decline in consolidated net profit to Rs 47.34 crore for the quarter ended September, against a net profit of Rs 76.94 crore in the same quarter a year ago.

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Tata Digital is at present creating verticals for several services such as grocery, pharmacy, dairy, lifestyle, education, medical consultation, beauty, logistics, consumer finance, insurance and payment options.

Multiple existing consumer-facing online units—e-commerce site Tata Cliq, Tata Health App, Tata Class Edge, which is about educational services, and ready-to-eat business Tata Q— are being integrated into Tata Digital, though the process is behind schedule, as per insiders. Through its proposed Super App, Tata wants to bring all these consumer businesses on one platform.

Tata Digital is also in the last leg of closing a deal to acquire a majority stake in BigBasket. ET reported that Tata has finalised a $1.2-billion deal for 60-63% in the online grocery. The transaction is awaiting regulatory clearance from the antitrust regulator Competition Commission of India, as reported earlier.

Tata is also in the last lap of executing a secondary transaction of $200-250 million to acquire 55% in online pharmacy 1mg, according to sources. ET had reported the potential deal on November 6 last year, which followed Reliance Industries’ foray into the space by acquiring a 60% stake in Netmeds for around Rs 620 crore.



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