Eternal Ltd. delivered another quarter that reinforced one message for investors: quick commerce continues to dominate the company's growth story. While the Zomato parent reported a 260% year-on-year jump in consolidated net profit for the June quarter, earnings fell short of Street expectations even as revenue came in marginally ahead.
More importantly, management struck a confident tone on competition, Blinkit's profitability trajectory and the sustainability of growth — prompting most brokerages to raise their price targets despite mixed headline numbers.
Here are the 10 biggest takeaways from Eternal's first-quarter results.
1. Profit Surged But Still Missed Estimates
Eternal's consolidated net profit rose to Rs 92 crore from Rs 25 crore a year ago. However, the figure was well below analysts' expectations of around Rs 300 crore, making it the biggest disappointment in the earnings report.
2. Revenue Growth Remained Exceptional
Revenue nearly tripled to Rs 20,211 crore from Rs 7,167 crore last year, slightly ahead of Street estimates of Rs 20,058 crore. A significant portion of the increase reflects the shift to Blinkit's inventory-led model, under which gross merchandise sales are recognised as revenue instead of only commissions.
3. Blinkit Continues To Be The Growth Engine
Quick commerce remained the biggest contributor to growth, with revenue soaring to Rs 15,664 crore from Rs 2,400 crore a year earlier.
Management also highlighted that Blinkit's net order value (NOV) climbed 86% year-on-year, while the platform added 200 new stores during the quarter, taking the network to 2,443 stores.
4. Blinkit Turned Meaningfully Profitable
One of the quarter's biggest positives was Blinkit's improving profitability. The business reported EBIT of Rs 365 crore, compared with a loss of Rs 42 crore a year ago.
Management said adjusted EBITDA improved for the fifth consecutive quarter, underscoring that scale benefits are beginning to offset expansion costs.
5. Food Delivery Business Regained Momentum
Revenue increased 37% to Rs 3,100 crore, while management said order value growth accelerated beyond 20% after four consecutive quarters of improvement.
Food delivery EBITDA margins have now moved close to the upper end of the company's long-term guidance of 5-6%, although management said it does not see growth and margins as a trade-off.
6. Hyperpure Remained The Weak Spot
Unlike Blinkit and food delivery, Hyperpure reported a 55% decline in reported revenue to Rs 1,034 crore.
However, the company clarified that on a like-for-like basis, Hyperpure revenue actually grew 27%, with the reported decline primarily reflecting accounting changes related to non-restaurant business operations.
7. Management Isn't Worried About Competition
Founder and CEO Deepinder Goyal said newer platforms are largely competing on price without creating new customer use cases, while Blinkit remains focused on building infrastructure and improving customer experience rather than chasing short-term market share.
The company also reiterated that infrastructure-led growth creates operating leverage, unlike discount-led expansion that can be difficult to sustain.
8. Blinkit Investments Will Continue
Management made it clear that Blinkit's rapid expansion is far from over. The company has invested around Rs 3,000 crore in capex over the past four years and intends to keep investing as long as returns remain attractive.
It also revised its long-term assumptions, including higher capex per store and confidence that quick commerce can ultimately generate EBIT margins of around 4% with adjusted EBITDA at the upper end of the 5-6% range.
9. Brokerages Remain Overwhelmingly Positive
Despite the earnings miss, most global brokerages retained bullish recommendations. Jefferies maintained its Buy rating and raised the target price to Rs 415, saying quality growth matters more than market-share chasing.
Citi reiterated Buy, increasing its target to Rs 385, citing Eternal's structural advantages in quick commerce. Morgan Stanley maintained Overweight and lifted its target to Rs 373, saying execution continues to strengthen confidence in management.
Macquarie was the lone cautious voice, retaining Underperform with a Rs 190 target while remaining sceptical about industry-wide quick-commerce economics.
10. The Investment Thesis Remains Centred On Blinkit
The June-quarter numbers suggest that Eternal is increasingly becoming a Blinkit-led story. Food delivery continues to generate healthy cash flows, but investor attention is firmly shifting toward how quickly Blinkit can scale profitably while defending its leadership against rising competition.
Although quarterly earnings fell short of consensus expectations, management's confidence on margins, expansion and competitive positioning was enough for most brokerages to become even more constructive on the stock.
ALSO READ: Eternal Says Current Level Of Quick Commerce Discounting Won't Continue Beyond Near Term
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