Reliance steps into e-pharma by acquiring Netmeds

The Covid-19 pandemic has been a blessing in disguise for the e-pharmaceutical sector. With the lockdown confining people indoors, Customers have gathered the courage to order their medicines from mobile pharma apps.

A subsidiary of Reliance Industries Limited (RIL), Reliance Retail Ventures Limited (RRVL) has acquired a majority shareholding in Chennai-based Vitalic Health Pvt. Ltd. and its subsidiaries (collectively known as 'Netmeds') for 620 crores.  

Vitalic Health Pvt. Ltd. and its subsidiaries were incorporated in 2015, since then they have been in the business of distribution, sales, and business support services in the pharmaceutical sector. They have an established online pharmacy platform, Netmeds that delivers medicines and even provides doctor bookings and diagnostics through its website and mobile app.

And the Dadha family have ventured into the pharma retailing business far back in 1914 and into drug manufacturing in 1972.

By this investment, RRLV becomes 60 % holding in the equity share capital of Vitalic and 100 % direct equity ownership in its subsidiaries, consisting of Tresara Health Pvt. Limited, Netmeds Market Place Limited and Dadha Pharma Distribution Pvt. Limited and it has lead to a rise in the share price of Reliance by 1.31% at Rs. 2,118.75/ share.

Director of Reliance Retail Ventures, Ms Isha Ambani, vocalized that the significance of the investment was to provide digital access for everyone in India and enhance its ability to provide standard medicinal products and health care products & services at affordable prices. She added that it will broaden its digital commerce proposition to include most daily essential needs of consumers.

After Amazon India rolled out its e-pharmacy services in Bengaluru and announced plans to conduct pilots in other cities, RRVL made an entrance into the competition in the market of online pharmacy.

Reliance Industries had also launched an online grocery service JioMart, putting it against Amazon and Flipkart in the lucrative e-commerce market.

Reliance has raised more than $20 billion to enhance its digital Platforms in the past few months, including from the likes of Facebook and Alphabet's Google.