Eternal Ltd., formerly known as Zomato, is set to announce its Q2FY26 earnings on Thursday, October 16, 2025, and analysts predict a mixed bag of results. While revenue is expected to show strong growth, driven primarily by Blinkit and Hyperpure, profitability may be under pressure.
Revenue Growth Fueled by Blinkit and Hyperpure
Brokerage estimates suggest a wide range for Eternal's revenue performance, with potential year-on-year growth of up to 137%. Morgan Stanley is particularly bullish, forecasting revenue at ₹12,170 crore, a 137.3% year-on-year and 60.9% sequential increase. This surge is attributed to strong gains in Blinkit's order volume and a favorable shift in business mix. Other brokerages, such as BofA and Bonanza, also project strong revenue growth, driven by Blinkit's rapid expansion in metropolitan and Tier-I cities and increasing order frequency. Nuvama Institutional Equities expects a 27% quarter-on-quarter and 89.7% year-on-year revenue growth for the consolidated business, reaching ₹9,102 crore. Kotak Institutional Equities estimates a 76% year-on-year growth in Hyperpure revenues.
Profitability Under Pressure
Despite the optimistic revenue projections, Eternal's bottom line may face challenges. Analysts anticipate a potential drop in profit, possibly as much as 71% year-on-year, primarily due to the cost-intensive nature of Blinkit's expansion. However, other reports indicate a more positive outlook for profit. JM Financial projects Eternal's consolidated EBITDA to jump 120% QoQ to ₹252.5 crore, while net profit may rise to ₹78.4 crore from ₹25 crore sequentially.
Key Expectations and Contributing Factors
Several factors are expected to influence Eternal's Q2 performance:
- Blinkit's Continued Momentum: Brokerages highlight Blinkit's strong momentum, driven by rising app traffic, dark store expansion, and entry into new cities. Citi expects Blinkit's gross order value to grow about 140% year-over-year, aided by festive demand and strong user acquisition.
- Food Delivery Growth: Most expect the company to post mid-to-high teens growth in food delivery GOV, driven by festive demand and rising user acquisition. Nuvama estimates food delivery gross order value to grow 4.9% QoQ and 16.5% YoY.
- Margin Expansion: Citi anticipates quick commerce segment margins improving toward breakeven by the next quarter, with further expansion in FY27–28. For the food delivery business, analysts model a 20 basis points (Q-o-Q) expansion in the contribution margin (CM) to 8.4% in Q2, largely on account of higher platform fees.
- EBITDA and Net Profit: JM Financial projects Eternal's consolidated EBITDA to jump 120% QoQ to ₹252.5 crore, while net profit may rise to ₹78.4 crore from ₹25 crore sequentially.
Analyst Ratings and Target Prices
Brokerages remain largely upbeat on Eternal, citing sustained strength in both food delivery and quick commerce. Citi raised its target price to ₹395 per share, citing stronger growth visibility and margin improvement in Blinkit. Kotak Institutional Equities has a target price of ₹375.
Competitive Landscape
Eternal's rival, Swiggy, is expected to narrow losses but remain in the red. While Eternal is expected to report a sequential improvement in NOV growth and margin across its Food Delivery and Quick Commerce businesses, Swiggy is expected to face balance sheet challenges due to minimal change in absolute QC losses.
In conclusion, Eternal's Q2FY26 results are expected to showcase strong revenue growth, primarily driven by Blinkit and Hyperpure. However, the company's profitability may be under pressure due to the costs associated with Blinkit's expansion. Analysts are optimistic about Eternal's future, citing the company's strong growth potential and improving margins.
