ImpactAlpha, June 17 – Gurgaon-based 1MG provides online access to medicine and other health products, as well as telehealth and remote diagnostic services, to 20,000 postal codes in India. Tata Group, the Indian multinational conglomerate known for industrial materials and manufacturing, acquired a majority stake in 1MG via its two-year-old digital business unit, Tata Digital.
The deal is Tata Digital’s second acquisition in as many months.
Tata Digital’s Pratik Pal said the company inked the deal to “provide superior customer experience and high-quality healthcare products and services in e-pharmacy and e-diagnostics”—a $1 billion-and-growing market in India.
“1MG is yet another example that ‘proves the model’ of impact investing,” tweeted Omidyar Network India of the acquisition. Omidyar Network India is among 1MG prior investors, along with Sequoia Capital, International Finance Corp., the Gates Foundation and others.
Terms of the deal were not disclosed.
While there are numerous small ventures offering digital healthcare services to India’s 1.4 billion population, 1MG ranks among the top three online pharmacies. It competes with PharmEasy and Nedmeds, which was acquired last August by Reliance Retail, another conglomerate.
“These companies add a lot of value,” because they boost efficiency in India’s pharmaceutical supply chain, observed Ramraj Pai of Impact Investors Council India. “1MG in particular is a services platform, also offering consultations. It’s a good investment from an impact perspective.”
Tata Group launched Tata Digital to tap into emerging tech trends influencing consumer spending and behavior. Last month, it acquired a stake in grocery delivery giant Big Basket.
Its investments in 1MG and Big Basket signal the company’s ambitions to compete against Reliance and Amazon in the country’s growing e-commerce sector.