Bigbasket looks to raise $250-300 million to fight the Reliance Industries-Facebook
Online grocery delivery platform Bigbasket has crossed an annualised gross sale runrate of $1 billion for the first time in May, riding on strong consumer demand for grocery and essentials due to the Covid-19 pandemic.
The Bengaluru-based company will become the second sector-focused online retailer after fashion portal Myntra, and horizontal e-tailers like Flipkart and Amazon India that sell all goods, to cross the billion-dollar sales mark. Myntra has a gross merchandise value (GMV) of over $2 billion.
Bigbasket co-founder and CEO Hari Menon told that it clocked Rs 650 crore, or almost $90 million of sales, after discounts, in May and that the sales growth trend remains steady in June too. The Alibaba-backed company is also looking to raise $250-300 million from new and existing investors, eyeing a valuation in the range of $1.5-2 billion.
The aim is to shore up a war chest to fight the Reliance Industries-Facebook combine and diversify the investor base. Menon confirmed he has appointed Morgan Stanley and Goldman Sachs for the fund-raise, which are in the initial stages of the process, while declining to comment on further details. "We grew 35 per cent on a month on-month basis in April, and then the next two months we grew roughly about 18 per cent and 20 per cent. It (the demand) is holding really well. Including BB Daily, we are clocking 3.5 lakh orders, which was around 2.2 lakh orders a day (before pandemic)," Menon said. BB Daily is a separate micro-delivery platform of Bigbasket, which delivers milk, bread and eggs on a subscription basis.
The product mix has also changed on Bigbasket. In value terms, fruits and vegetables — which used to be 16-18 per cent of its business have now jumped to 20-22 per cent. "The whole thing (business) got advanced by 12-15 months. Operational profitability is a few months away," he added. Menon said the growth momentum will continue, based on the sales expansion of the last four months.