The Adani Group, founded by billionaire Gautam Adani, is now stepping into India’s fast-growing consumer market. The conglomerate, known for its vast infrastructure and logistical prowess across ports, airports and electric power, is reportedly gearing up to capture a sizeable share of India’s e-commerce and digital payments market through its innovative Adani One app. This move positions Adani to compete with industry giants like Google and Mukesh Ambani’s Reliance Industries in India’s burgeoning digital market.
The Adani Group is in discussions to secure a license to operate on India’s public digital payments network, the Unified Payments Interface (UPI). Concurrently, negotiations are underway with banks to launch a co-branded Adani credit card.
Moreover, in a bid to tap into India’s thriving e-commerce sector, the Adani Group is exploring options to offer online shopping services through the Open Network for Digital Commerce (ONDC). This government-supported platform presents a lucrative opportunity for the conglomerate to cater to the evolving needs of Indian consumers.
It’s worth noting that Google and PhonePe currently dominate India’s UPI market, with a combined share of approximately 87%.
Meanwhile, in the e-commerce space, companies like Paytm and Tata facilitate shopping services through ONDC. This system of “interoperable” networks eliminates the need for companies to invest in proprietary payment or e-commerce platforms, as they can conduct transactions through other providers. This not only enhances convenience for consumers but also reduces barriers to entry for new players like Adani, as they can leverage existing infrastructure to establish their presence in the market.
Adani’s venture into consumer services represents a substantial expansion of its business. If these plans come to fruition, the services will be accessible through Adani’s consumer app, Adani One. Launched in 2022, Adani One is currently offering flight and hotel bookings.
Challenges For Adani
Adani’s ambitious foray into digital commerce and payments has sparked scepticism about its potential success. Industry analysts highlight challenges such as limited consumer traction and fierce competition from established players like Tata and Reliance.
However, despite being launched in 2022, Tata’s so-called super app, Tata Neu, has failed to impress consumers and gained limited traction among Indian consumers. In contrast, Reliance has solidified its position in consumer sectors like telecoms, retail, and entertainment.
Independent analyst Satish Meena notes that Adani’s current offerings may not be compelling enough to sway customers from established online platforms.
However, Adani is optimistic about its entry into the e-commerce and payment sectors, seeking to capitalize on its existing user base. Insiders reveal that Adani’s digital services will initially target its vast pool of existing customers, including millions of gas and electricity users and airport travellers. These users could earn loyalty points through various transactions and redeem them for online shopping, providing Adani with a strategic entry point into broader consumer markets.
Additionally, Adani’s plan to incorporate NDTV content into its super app demonstrates its commitment to enhancing user experience and expanding its digital footprint.
Facing Controversies and Scrutiny
The Adani Group’s digital ambitions come amid controversy and scrutiny. Accusations of corporate misconduct from entities like Hindenburg Research and the Organized Crime and Corruption Reporting Project (OCCRP), coupled with allegations of market manipulation, have thrown a pall on the company. These issues have resulted in a loss of over $150 billion in market value in the past. Despite these setbacks, Adani has rebounded, demonstrating resilience and determination to forge ahead with its expansion plans.
Adani’s entry into the e-commerce and payments sectors highlights the burgeoning opportunities in India’s digital economy. The company’s success hinges on its ability to create a compelling user experience, rebuild trust after past controversies, and effectively compete with established players. With its vast resources and existing customer base, Adani has the potential to disrupt the Indian market, but only time will tell if it can navigate the competitive landscape.
