Walmart-backed e-commerce platform Flipkart is acquiring city-based online pharmacy SastaSundar as it looks to foray into the growing e-commerce healthcare segment.

The development comes at a time rival Amazon India has entered the category last year.

The online pharmacy sector has also seen acquisitions by Indian industry majors with Reliance Retail acquiring Netmeds and Tata Digital buying online pharmacy 1mg.

Flipkart on Tuesday said it has signed a definitive agreement with SastaSundar Marketplace, which owns and operates SastaSundar.com, for a majority stake but did not disclose the size of the deal.

SastaSundar was valued at around $100 million at its last round of funding in 2019.

Flipkart said with this agreement it has launched Flipkart Health+ which will leverage the pan-India reach and technology capabilities of the Flipkart Group and SastaSundar’s expertise to provide consumers end-to-end offerings in the health-tech ecosystem.

Besides e-pharmacy, there will be healthcare services such as e-diagnostics and e-consultation over time.

Flipkart Health+ will report to Ajay Veer Yadav, senior vice president and Flipkart veteran, the e-commerce platform said on Friday.

SastaSundar, which is supported by a network of more than 490 pharmacies, has raised a cumulative funding of around $48.2 million according to data from Tracxn. The two existing Japanese investors - Mitsubishi Corporation and Rohto Group - are expected to remain in the company.

Sastasundar Ventures scrips at Rs 487.30 were up 2.48 per cent at the Bombay Stock Exchange.

“The consumer internet ecosystem in India is growing rapidly as consumers recognise the opportunities and convenience that digital adoption is enabling in their lives. With growing awareness and focus on health heightened by the pandemic, there is a large opportunity and demand for affordable healthcare and ancillary offerings," said Ravi Iyer, senior vice president and head of corporate development at Flipkart, said.

“Through this partnership with Flipkart, we see an opportunity to further grow and reach a larger consumer base, using complementary technologies and logistics infrastructure,” said B.L. Mittal, founder and chairman, SastaSundar Healthbuddy Ltd.

Online pharmacies account for around 5 percent of the USD 19 billion India pharma market. It is expected to have 15-16 per cent share in next 10 years according to market reports.