Tata Group is considering investing $1 billion in its super app Tata Neu as the salt-to-software conglomerate looks to strengthen the digital sector.
The addition comes on top of the $2 billion that Tata Group invested in the project earlier this year, according to sources that spoke to Bloomberg on the condition of anonymity.
Should a deal go through, Tata Digital Pvt. will receive the fresh funding in the upcoming year.
According to one of the persons, the conglomerate has urged the digital division, which manages its primary online portal Tata Neu, to streamline procedures and address bugs in the app to make it more user-friendly.
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The persons claimed that Tata Group has additionally advised the super-app initiative to consider looking to international sovereign and financial investors for future funding needs.
That would be in line with the approach taken by its competitor Reliance Retail Ventures, which has routinely raised capital from outside sources. Recent investments in Reliance Retail by the Qatar Investment Authority and KKR & Co. were valued at $100 billion.
The people stated that while discussions are still ongoing, specifics of the Tata Group's investment in the project could change. A Tata Group official declined to comment.
Modelled after China's ubiquitous Alipay and WeChat, Tata Neu was India's first super app since at least mid-2020 but rapidly encountered technical issues and user concerns.
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Users of Tata Neu can purchase goods from brands owned by Tata, including food, electronics, and reservations for restaurants and flights. The app offers financial services like bill payment, loans, and insurance, as well as membership services.
Tata Group invested more than $2 billion in the last three years to buy businesses like e-pharmacy 1mg and e-grocer Bigbasket to strengthen its e-commerce portfolio.
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