Mahindra merging Mom & Me's e-com site with baby products e-tailer Babyoye

Mahindra Group, which runs one of the country's largest offline retail chains for baby and infant products under Mom & Me, is bringing the e-store of the chain under the recently acquired specialised e-com venture Babyoye, according to separate media reports in Business Standard and The Hindu BusinessLine.

Both the reports, citing top company executives, said the merger has also happened. They added that the group's separate toy store Beanstalk has also been shut.

However, momandmeshop.in, the online sales channel for Mom & Me remains active. This means the integration has not been completed. Beanstalk's e-com site now redirects tomomandmeshop.in.

The Mahindra Group is now reportedly looking at a dual branding strategy—one for offline stores and another for online sales channel.

Emails sent to Babyoye and Mahindra Group for further details on the joint business strategy and management structure, did not elicit any response.

This follows Mahindras buying out Mumbai-based startup Nest Childcare Services Pvt Ltd, that ran Babyoye.com, last month.

Babyoye is now under Mahindra Internet Commerce Pvt Ltd.

The acquisition was the first such M&A for an Indian business group in the e-com space, which has largely seen consolidation through mergers between common VC-backed ventures and shutdowns. This was later followed by Godrej Group buying online grocer EkStop.

While the combined entity would be better positioned to take on FirstCry, the largest online seller of baby products in India, given that the latter has also aggressively ramped up its own offline presence through the franchisee route, it will be a two-way battle at the top end.

Following them is Hopscotch, which has been following a differentiated business strategy and has recently scooped up fresh VC funding.

Meanwhile, Mahindra Retail's Prakash Wakankar told Business Standard in the above mentioned report that the firm expects to generate 10-12 per cent revenue contribution from e-commerce in the next financial year and 20-25 per cent in the coming years.

Mahindra Retail earned revenue of Rs 206 crore for the year ended March 31, 2014.

Babyoye, founded in 2010 by husband-wife duo Sanjay Nadkarni and Arunima Singhdeo, had last raised VC funding around two years ago from existing shareholders Tiger Global, Accel Partners and Helion Venture Partners. It had raised $12 million back then. Prior to that, Babyoye had raised money from Tiger Global and Accel in 2011.

It had acquired Hoopos.com, another e-commerce site operating in the same space, in an all-stock deal in 2013. This had brought Helion as a shareholder into the firm.

Babyoye, FirstCry and Hopscotch also compete with the top horizontal e-com marketplaces Flipkart, Amazon and Snapdeal which also offer baby products.

(Edited by Joby Puthuparampil Johnson)