Tata Sons to Fortify their Digital Arm by Investing $1 Billion

Tata Sons plans to invest approximately $1 billion in Tata Digital over the next few years, according to people familiar with the matter. This comes as the parent company of the diversified Tata Group halts external fundraising for Tata Neu, the ecommerce entity that houses the superapp, ahead of a likely review of its digital strategy with the appointment of a new CEO this week, according to the people.

According to one of the sources, Tata Digital will only seek external investment after the new CEO has set aside time to focus on execution and scale. Earlier this week, Tata Digital appointed Naveen Tahilyani, the former managing director of Tata AIA Life Insurance, as its CEO & MD. Tahilyani replaced Pratik Pal who had been holding the charge since the company's inception in 2019.

Tata Sons has already invested more than $2 billion in Neu and has board approval for additional capital infusions over the next five years, according to the people. A spokesperson for Tata Sons did not respond to ET's inquiries.

Multiple people familiar with the management changes said Tata Sons chairman N Chandrasekaran wanted a senior executive with consumer experience to steer Neu's next stage of expansion. "The top brass wants Tata Digital to work on making its operational structure more efficient and agile and scale up the business," a source said.