SUMMARY
BigBasket has issued fresh debentures to the Chinese investor
It is also raising funds from another existing investor, CDC Group
BigBasket has been facing issues in supply chain and manpower crunch
Bengaluru-based online grocery delivery platform BigBasket has now received INR 379.87 Cr ($49.9 Mn) in debt from existing investor Alibaba.
According to the ministry of corporate affairs filings by BigBasket’s B2B arm Supermarket Grocery Supplies, accessed by Inc42, the company has issued fresh debentures to Alibaba.com Singapore Ecommerce Private Limited.
The filings showed that on April 14, the company allotted 4,62,500 Series F CCD at a price of INR 8,213.5135 per share worth INR 379.87 Cr.
The details revealed that the company is raising $51.78 Mn from Alibaba and CDC Group. Of this, since Alibaba has invested $50 Mn, CDC is looking to put in $1.78 Mn.
Before this, BigBasket had raised $150 Mn in Series F funding round. With this round, the company had become the first online grocery delivery platform to enter the unicorn club with a $1.2 Bn valuation. It had also raised around $13 Mn in debt from Trifecta last year.
The money has come at a time when BigBasket needs to strengthen its operations to handle the demand surge for grocery delivery because of the lockdown. Due to lockdown, the company has been facing manpower crunch as its delivery partners were mostly migrant workers who went back home. The funds will also help BigBasket compete against Zomato, Swiggy and other new entrants.
The grocery delivery startup has been in the customer spotlight for cancelling the orders and refunding the money to the company’s wallet. After the initial week, when it finally got back in shape, the company said that it is finally operational in all its cities, but due to delayed orders, will first focus on fulfilling existing orders before accepting new orders. BigBasket also said it is focussing on bringing back its on-field workforce including delivery executives, pickers and packers.
CEO Hari Menon had recently said that the company has infrastructure capable of handling around 300K orders per day. Before the lockdown, BigBasket was clocking around 150K orders per day. However, the company will be looking to ramp up the infrastructure as people will be relying more on online platforms for their grocery orders.
As of now, the company is operating around 50% of its capacity. To enhance the operations, BigBasket has partnered with last-mile delivery companies which are helping the company to meet the demand.
Even though BigBasket’s biggest competitor has been Grofers for the most time, amid lockdown, it is now facing challenges from players like Amazon, Flipkart, Swiggy, Zomato, BharatPe, Meesho, NetMeds and many others. Due to increase in demand, and initial supply chain constraints coupled with restrictions in normal operations of several businesses, new entrants have been trying to encash the opportunity.
