Back in 2019, US retail giant Walmart, and its Indian e-commerce arm Flipkart made strategic investments in Ninjacart, which is into fresh produce agriculture market supply.
Again, in October 2020, both Walmart and Flipkart poured in more funds into the Ninjacart startup.
And yesterday, Flipkart and Walmart announced a fresh round of investment in Ninjacart, which itself has been investing significantly in tech platforms and supply chain infrastructure over the past two years.
Aside from these two entities, Ninjacart has attracted well-known backers such as Tiger Global, Accel, Tanglin, Steadview, Syngenta, Nandan Nilekani and Qualcomm among others.
The latest tranche of investment from Walmart and Flipkart amounts to $145 million (around Rs 1095 crore), and values Ninjacart at $900 million --- up by $400 million from the previous valuation at the time of previous investment.
"This investment will further accelerate Ninjacart’s journey towards building technology and infrastructure to organize, empower and enhance the lives of millions of agri value chain participants including farmers, resellers, retailers, consumers, and supply chain participants," Flipkart said in a press statement.
- Flipkart gets $3.6 billion in funding - Fight with Amazon, Reliance to get intense
- Walmart is encouraged and happy to learn from Flipkart
The fight in e-grocery space to get intense
So what does Flipkart and Walmart see in the Ninjacart business model that is not visible to us? At least, not at first glance.
Flipkart currently offers grocery in 1800 cities & towns and wants to take its offering to 2,000 more towns by mid-next year. Fresh fruits and vegetables will be an integral part of the expansion. And that is where Ninjacart's expertise kicks in.
Kalyan Krishnamurthy, CEO, Flipkart Group, said, “As a homegrown company, we have constantly focused on creating the right infrastructure and technological solutions that support local farmers, producers, and food processors. With this investment, we are further able to strengthen our grocery footprint and offering as consumers across the country throng to e-grocery for quality and affordable options in the fresh category."
Flipkart has also intensified its focus on partnering with Farmer Producer Organizations (FPOs) to provide access to high-quality fresh produce, staples, pulses, and spices.
Ninjacart hopes to build its agri network
Thirukumaran Nagarajan, Co-founder, and CEO, Ninjacart, said, “The funds will enable us to dream beyond organizing the farmer-to-retailer ecosystem to a much larger goal of organizing the complete agri ecosystem and enabling transparent commerce." He added that the funds will be deployed to build teams and scalable tech platforms to organize and grow the network.
As you can see, Flipkart, having firmed up its supply chain, will be more confident to take on the challenges posed by Amazon, Reliance’s JioMart and the Tata-backed BigBasket.
Ninjacart works closely with the farmers and has till date has tied up with 1,00,000 farmers across 150 villages. Its supply chain technology comes in handy to reduce distribution inefficiency and price risk.
This will explain why Flipkart and Walmart are not averse to pumping in more money (through investments) in Ninjacart.
At stake is India's e-grocery market, which is expected to be worth $850 billion by 2025.
