London: Amazon.com Inc. is in preliminary talks to buy the online grocery site BigBasket, as the American e-commerce firm steps up efforts to gain ground in the fast-growing market, according to people familiar with the matter.

The discussions are at an early stage and may not lead to a sale, the people said, asking not to be identified as the negotiations are private. BigBasket, run by SuperMarket Grocery Supplies Pvt, is India’s largest online grocery firm and operates in about 25 cities across the country.

A spokesperson for BigBasket said that it’s untrue that Amazon is in talks to buy the firm.

A representative for Amazon declined to comment.

Amazon chief executive officer Jeff Bezos has vowed to spend $5 billion in India in coming years as he competes against local rivals. Amazon’s success in the country has pushed the two largest domestic e-commerce players, Flipkart Ltd and Snapdeal, into a preliminary agreement to combine.

BigBasket raised $150 million last year in a funding round led by Dubai’s Abraaj Group, and its backers also include Bessemer Venture Partners and Helion Venture Partners. In March, BigBasket raised Rs45 crore ($7 million) in venture debt from Trifecta Capital to set up new warehouses and strengthen its delivery network.

Amazon and BigBasket have not yet agreed to any specific terms, said one of the people. BigBasket has also had discussions with private equity firms, the person said. The start-up has been boosting revenue quickly and has reached break-even in two cities, the person said.

Amazon has been expanding in online food and grocery sales as it seeks to increase its product offerings. This year, it opened drive-in grocery locations in Seattle, its home town, as part of a renewed effort in the business.

In India, the company has sought approval to invest and partner with the government in food supply. Amazon said in an email in February that it has sought a license for food retail trading from the government’s Department of Industrial Policy and Promotion (DIPP), which oversees foreign investments into the country. Amazon’s plans to invest close to $500 million in India’s online food retailing sector will soon get government approval, the Press Trust of India reported food processing minister Harsimrat Kaur Badal as saying on Tuesday. Bloomberg

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