Tata 1mg, the digital health platform and online pharmacy owned by Tata Digital, is preparing to raise $200 million in a new funding round, with interest from investors including Novo Holdings, Canadian pension fund CPPIB, Permira, and Chrys Capital, according to people familiar with the matter. The fundraising is part of a wider capital infusion across Tata Digital’s businesses, including BigBasket.
While Tata 1mg is regarded as one of the strongest performers in the Tata Digital portfolio, investor interest has come with valuation concerns. The company was last valued at $1.25 billion in 2022, but potential investors are reportedly pegging its valuation lower, in the range of $750–800 million. Some are also seeking board representation and additional rights, which Tata is said to be resisting. The company currently requires around $125 million in fresh capital.
Earlier suitors such as Singapore’s GIC and Warburg Pincus are no longer in the running. Tata Digital continues to hold about 63% of Tata 1mg, while existing investors include Sequoia Capital, Intel Capital, Omidyar Network, and the Bill & Melinda Gates Foundation.
Acquired by Tata in June 2021, Tata 1mg has steadily expanded its offerings beyond online pharmacy to diagnostics, consultations, and institutional health services. The platform now lists over 800,000 stock-keeping units, delivers to more than 20,000 pin codes, and operates over 100 hybrid stores combining pharmacy and diagnostics. Plans are underway to scale this to 3,000 outlets by FY30.
On the performance front, Tata 1mg reported a 22% rise in consolidated revenue to ₹2,392 crore in FY25 from ₹1,968 crore in FY24, split between Tata 1mg Technologies (₹2,016.5 crore) and Tata 1mg Healthcare Solutions (₹375.5 crore). Losses narrowed to ₹276 crore in FY25 from ₹313 crore in FY24. On a unit basis, the company spent ₹1.12 to earn each rupee of operating revenue.
The company has also been strengthening its delivery capabilities, offering order fulfillment within four to five hours in select cities such as Delhi-NCR, with a 30-minute express delivery option for certain products.
Online pharmacies currently make up just 3–5% of India’s pharmaceutical market, compared with nearly 20% penetration in developed economies—pointing to significant headroom for growth.