After the mega acquisition of Air India last month, another high-profile endeavour is underway in Tata Group, one of the country’s largest conglomerates. Its new internet-focused unit, Tata Digital, is looking to raise funds with expectations of notching a $20-billion valuation.

The unit has formally approached investors with a memorandum of interest over the past month, said two people briefed on the matter. 

The development comes as it prepares for the commercial launch of super-app TataNeu, with the date widely expected to be in March or April. It has been testing the app among the group’s 800,000-plus employees for the past two quarters, one of the key initiatives of Tata Sons chairperson N Chandrasekaran.

In its pitch for fresh capital, Tata Digital is projecting a massive 3X increase in the collective gross merchandise value (GMV) of its businesses, the sources said. These include the startups it acquired recently, e-grocer BigBasket and online pharmacy 1mg, apart from group divisions like electronics retailer Croma.

To secure a monster valuation, the company is contacting bulge-bracket investors and firms which can provide at least $500 million and help set the terms, said an investment banker familiar with the pitch. But one of the people mentioned above said the specifics had not been finalised.