Eternal Shares Surge 11% Despite 90% Profit Drop as Blinkit Outshines Zomato’s Core Business; Should You Buy?

Shares of Eternal Ltd, the parent company of Zomato, soared to a new peak on July 22, 2025. This surge followed an over 11% gain the previous day, driven by the company's earnings report for the April-June quarter. Despite a significant 90% drop in net profit for the first quarter of FY26, falling to Rs 25 crore from Rs 253 crore in the same period last year and revenue jumped 70% to Rs 7,167 crore.

Eternal Share Price Today After Reporting Q1 Earnings

NSE: ETERNAL: As of 2:30 PM on July 22, shares of Eternal Ltd were trading at Rs 301.85, marking a significant gain of Rs 30.15 or 11.10% for the day. The stock opened at Rs 293.00 and reached an intraday high of Rs 311.25, while the lowest point recorded during the session was Rs 289.65.

Zomato's Profit Drops 90% But Stocks Up 11%; What's Driving the Rally?

Despite reporting a staggering 90% year-on-year decline in net profit to Rs 25 crore for Q1 FY26, Eternal Ltd saw its shares soar over 11%, surprising many market watchers. The unexpected rally appears to be driven by strong top-line growth and the performance of Blinkit, the company's quick-commerce arm.

For the April-June quarter, Blinkit generated Rs 2,400 crore in revenue, surpassing Zomato's core food delivery revenue of Rs 2,261 crore, signaling a shift in the company's revenue dynamics.

While the company's consolidated EBITDA came in at Rs 115 crore, down 35% compared to the same quarter last year, investors appear optimistic about the company's rapid expansion and Blinkit's emerging dominance in the quick-commerce space.

Brokerage Opinions and Future Outlook on Zomato Stock

Despite the sharp decline in net profit, many brokerages remain optimistic about Eternal's stock. Jefferies upgraded its rating to 'buy', setting a higher price target of Rs 400 per share. The brokerage noted that while Q1 results were mixed, management's commentary was encouraging. Growth remains robust with improved margin prospects as competitive pressures lessen.

CLSA maintained its 'high-conviction outperform' rating on Eternal with a price target of Rs 385 per share. This decision was based on Blinkit's performance exceeding expectations in terms of gross order value (GOV) and contribution. Similarly, Bernstein reaffirmed its 'outperform' rating and increased its target price to Rs 320 per share due to strong performance in quick commerce.

On the contrary, Macquarie stood out with an 'underperform' rating and set a price target of Rs 150 per share. The brokerage highlighted that while quick commerce showed explosive growth and moderated losses positively, food delivery growth lagged behind. They anticipate high competitive intensity will persist, leading to extended periods of losses.

Eternal's management expressed optimism about future growth prospects despite current challenges. CFO Akshant Goyal announced that "Our B2C operations have now reached nearly $10 billion in annualised NOV, with quick commerce accounting for nearly half of it." This indicates potential for continued expansion in quick commerce.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.