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Informist, Friday, Apr. 24, 2025

By Avishek Rakshit

KOLKATA – Geographic expansion and the addition of dark stores that are driving Eternal Ltd.'s grocery delivery business are expected to help the company to report strong revenue and profit growth in the March quarter. Increasing gross order value is also expected to boost the top line.

Eternal, the market leader among online food ordering and delivery platforms, is expected to report a jump of 208% on year in its consolidated revenue for the March quarter to nearly INR 180 billion, according to an average of estimates from 12 brokerages. Its consolidated net profit is expected to rise even higher at 286% to INR 1.50 billion, according to the average of estimates.

On a sequential basis, however, the net profit is likely to rise nearly 48% and the revenue is expected to increase by around 10%. Eternal, earlier known as Zomato, will declare its results for the March quarter Tuesday.

Motilal Oswal Financial Services Ltd. has the highest estimate for the company's net profit at INR 2.08 billion and Kotak Securities Ltd. has the lowest at INR 678 million. Motilal Oswal, however, has the lowest revenue estimate at around INR 164 billion. Dolat Capital Market Pvt. Ltd. has the highest estimate for revenue at around INR 196 billion.

Kotak Securities and ICICI Securities Ltd. expect Eternal to post 20% year-on-year growth in its food delivery gross merchandise value. Nuvama Wealth Management Ltd. has pegged the year-on-year net merchandise value growth at a shade over 18%. However, the net merchandise value of the grocery business housed under the Blinkit brand is expected to grow 99%, according to Kotak Securities and Nuvama.

Sector analysts said the growth in the grocery business is mainly on account of rapid store additions in the March quarter. Kotak Securities estimates that Eternal added 173 dark stores in the quarter, taking the total count to 2,200 at the end of March.

Eternal is expected to report consolidated earnings before interest, tax, depreciation, and amortisation of INR 4.47 billion for the March quarter, according to an average of estimates from nine brokerages. JM Financial Institutional Securities Pvt. Ltd.'s estimate for EBITDA is the highest at INR 5.33 billion and ICICI Securities Ltd.'s estimate of INR 4.06 billion is the lowest.

Kotak Securities expects Eternal to report an increase of 20 basis points in the EBITDA margin of the food delivery business to 4.6%. The margin expansion is seen to be partially driven by an increase in platform fee at the end of the March quarter. For the Blinkit business, ICICI Securities projects the adjusted EBITDA margin, as a percentage of gross order value, to grow by 21 bps sequentially to 0.2%.

Of the 11 research reports on the company available with Informist, 10 have a "buy" recommendation on the stock at an average target price of INR 377.40. One brokerage has a "sell" recommendation.

Friday, shares of Eternal closed over 1% lower at INR 256.79 on the National Stock Exchange. The shares are down over 8% since the company announced its December quarter earnings on Jan. 21.

The following are the Jan-Mar earnings estimates, in INR million, for Eternal from 12 brokerages in descending order of the net profit estimate:

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Edited by Rajeev Pai

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