Mumbai, February 2 A unit of China’s Alibaba has invested $146 million in online grocer BigBasket, strengthening its position in the country’s online retail space and potentially posing a challenge to US rival Singapore Ecommerce Pvt Ltd led the $196.7 million Series E funding round, which was approved by the BigBasket board in January, regulatory filings seen by Reuters on Friday showed.

Online grocery sales are fast becoming popular in India, with BigBasket, SoftBank-backed rival Grofers and Amazon’s India unit vying for a bigger piece of the market.

Sands Capital Pvt Growth Ltd, International Finance Corp and Abraaj Basket I Pvt Ltd also participated in the latest funding round.

Founded in 2011, Bengaluru-headquartered BigBasket services more than 6 million registered customers across 26 Indian cities.

Through its units, Alibaba holds various investments in India's growing online retail space, including a stake in the parent of mobile payments provider Paytm.