Tata Neu Gears Up To Challenge Swiggy, Zomato In Online Food Ordering

The Tata Group‘s super app, Tata Neu, is set to make its foray into the online food ordering sector, marking a significant shift for traditional Indian corporate houses.

What Happened: As per a Moneycontrol report, Tata Neu is planning to roll out its food ordering service through the Open Network for Digital Commerce (ONDC). The service is slated to undergo closed-user group trials soon, with a wider public launch expected in a month or more.

The venture into food ordering is designed to create a ‘high-frequency use case’ to encourage regular app usage. This will also allow Tata Neu to cross-sell its other products across diverse categories such as apparel, jewellery, grocery, electronics, flights and more.

The integration with ONDC will enable the app to access tens of thousands of eateries across cities already on the network. At present, Swiggy and Zomato hold over 95% of the food delivery market share.

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The ONDC project at Tata Neu is led by Gaurav Porwal, a senior vice president at Tata Digital. The company is reportedly planning a fresh billion-dollar fund infusion in Tata Digital, despite a widening net loss in FY23.

Tata Neu’s entry into food ordering via ONDC is seen as a cost-effective strategy as it eliminates the need for deploying a delivery fleet or convincing restaurants to sell on the app.

Tata Group’s move into the online food ordering sector comes amid significant investment in its digital arm. In October 2023, the conglomerate reportedly considered injecting $1 billion (₹8,319 crore) in fresh capital into its super-app venture. This was in addition to the $2 billion (₹16,638 crore) invested earlier that year.

Furthermore, Tata Sons is reportedly looking to sell a minority stake in Tata Digital, the entity behind the Tata Neu super app, to raise approximately ₹100 crore from global private equity funds.

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