BigBasket, the Tata group-owned online grocer, is eyeing to come out with an initial public offering in 2025 after turning profitable, a top official said on Tuesday.
The Bengaluru-based company, a part of Tata Digital, will turn profitable in another 6-8 months, once the newly launched ‘BB Now’ vertical starts making money, its co-founder and chief executive Hari Menon said.
When asked about plans for an IPO, he said, “We will probably have it in 2025. But we are leaving it to the Tatas, there cannot be anybody better to guide us and advise us on that.”
He hinted that the issue will include both primary and secondary share sales, but did not share any more details.
Continue Exploring: BigBasket teams up with Chef Sanjeev Kapoor to introduce frozen foods brand ‘Precia’, targets INR 100 Crore in online sales by 2026
He stated that the business necessitates capital for continuous investments, which will be sourced from the Tata Group leading up to the IPO. He further added that the majority of these investments will be directed towards technology, marketing, and personnel.
The company, which competes with similar offerings from Amazon and Flipkart, is targeting to close FY24 with a revenue growth of 30-35% over the previous fiscal, with a topline of about INR 12,000 crore, Menon said.
On profitability, he said the enterprise will turn profitable once the newly launched BB Now under which it delivers products in 10 minutes turns profitable, which is in the next 6-8 months, Menon said, adding that the older business lines including slotted and BB Daily are in the black.
He said it is easier for the new business to turn profitable because the back end is common across the three business lines.
At present, over 70% of its revenues come from the slotted business, while the relatively newer BB Daily, under which it delivers items like milk early in the morning, and BB Now, account for the remaining 30%, Menon said.
The company does not have any plans of entering the broader e-commerce space, unlike its competition, Menon said, adding that it will concentrate on the kitchen-related space and continue being a grocer.
It is currently piloting a concept of having an offline presence to try out the omnichannel format, Menon said.
Over 36% of its current sales come from private labels, Menon said, adding that it is aiming to take the higher margin business’ contribution to 40-45% in the next two years.
It, however, does not have any plans of having a strategy of selling its private labels from offline outlets.
When asked about the traffic coming from the Tatas’ super app, Menon declined to comment. He also declined to comment on working under Tata Digital’s new chief executive and managing director Naveen Tahilyani, saying these are still early days of working with him.
When asked about some reports before the takeover of the company by Tatas, which stated that he would be leaving the company after some time, Menon said there were no such plans.
Earlier, BigBasket launched a line of frozen foods in a tie-up with celebrity chef Sanjeev Kapoor to tap an estimated $1.5 billion opportunity.
Menon said it is targeting sales of up to INR 150 crore from the line christened “Precia” by 2026, and will be focusing on marketing the products, which also include items like momos and desserts.
Continue Exploring: BigBasket rebrands slotted delivery to ‘bigbasket supersaver’, targets 1-hour service for faster deliveries
