Food aggregator Zomato’s parent firm Eternal’s stock price rose 10.34% to ₹299.8 on Tuesday, despite a 90% plunge in Q1FY26 net profit to ₹25 crore. The last time the stock was up the same quantum was on July 26, 2021, three days after it got listed. The stock’s performance assumes significance as among the 993 days of trading, it was on a decline on 49% of days. Quick commerce platform Blinkit outpacing Zomato in revenue led to the surge in Eternal’s stock price.
A lot of the excitement came from the increase in Gross order Value (GOV) of Blinkit which more than doubled in the reporting quarter on a year on year basis. Brokerages cited the potential of Blinkit to grow and close the gap with Zomato, which is currently contributes the most, behind their Buy recommendations for the stock. “In an elevated competitive landscape, Blinkit’s grip over contribution margin (percentage of GOV) was commendable, up +11bps QoQ to 3.1%,” said a report by Elara Securities.
Despite the declining profit, analysts recommended that investors buy the stock as they believed that the losses had bottomed out. “Management believes absolute losses have peaked and margins will continue to improve as recently opened stores mature…The store count is expected to increase from ~1,550 currently to 2,000 by Dec. ’25, with visibility up to 3,000,” said analysts at Motilal Oswal. The brokerage had forecast a revenue increase of 62% on a year-on-year basis, but the company exceeded the expectation.
Analysts at Elara Securities, while recommending investors to buy the stock, were cautious about the possibility of mild rise in loss in fiscal 2026. “We expect Blinkit to maintain industry-leading show on user growth and GOV. But higher fixed costs may continue to drag adjusted EBITDA. Thus, we model in a mild rise in losses (FY26E), resulting in 25%/15% cut in FY26E/27E EBITDA estimates,” according to the research note.
Published – July 22, 2025 10:37 pm IST