Eternal shares have surged over 20% in the past month, demonstrating a significant turnaround from earlier weakness. The stock had fallen to a 52-week low of ₹212 in March amid concerns around quick commerce prospects and frothy valuations, but recently rallied 10% in just two sessions and about 21% in the last month. Despite these recent gains, the stock trades 20% below its October peak of ₹368 per share, indicating room for further upside potential. Multiple brokerages including JPMorgan, CLSA, Jefferies, Nomura, Motilal Oswal and Emkay have maintained positive ratings, citing accelerating growth in food delivery and Blinkit, improving quick commerce profitability, stronger margin guidance and management's confidence that competitive intensity has become more predictable.
According to reports from The Financial Express, Jefferies has raised its target price to ₹415 from ₹400, implying an upside of about 45%, after Eternal demonstrated a significant strategic pivot. The company is now willing to let rivals grow faster if that growth is driven by heavy discounting, moving away from pursuing market share at any cost. As reported by Jefferies, management described aggressive discount-led competition as a 'systemic trap', arguing that companies eventually reach a point where they have to choose between growth and profitability. Eternal believes there is little evidence that deep discounting creates durable customer loyalty, prompting Blinkit to use price incentives only where they create sustainable long-term value rather than short-term order growth. The company now expects Blinkit's steady-state EBITDA margin to reach 6% of NOV, compared with its earlier estimate of 5-6%, driven by efficiencies from larger stores and warehouses, deeper assortments and better working capital management.
As reported by The Financial Express, Blinkit's adjusted EBITDA improved to ₹102 crore, equivalent to 0.6% of NOV, compared with ₹37 crore in the previous quarter. The quick commerce segment's net order value increased 19% quarter on quarter to ₹17,132 crore, supported by growth in monthly transacting users, higher order volumes and continued investments in assortment, geographical reach and supply infrastructure. Monthly transacting users increased to 31.8 million from 27.2 million in the previous quarter, while the number of orders rose 21% quarter on quarter to 331 million. The brokerage noted that inventory losses, including pilferage and shrinkage, remain contained at around 1.8% of NOV, reflecting operational discipline despite rapid expansion. Net working capital days are expected to decline from 18 days to 12 days in the steady state.
According to reports from The Financial Express, Eternal's food delivery business produced another strong quarter, with food delivery NOV increasing 20% year on year to ₹10,769 crore. Monthly transacting users rose to 27.2 million from 22.9 million a year earlier, while the number of orders increased 22% year on year to 285 million. Take rates improved to 32.8% from 32.0% in the previous quarter, helping adjusted EBITDA rise 34% year on year to ₹606 crore. EBITDA margin reached 5.6% of NOV, the highest level in several quarters, with contribution margin remaining stable at 10.2% despite continued spending to support growth. Management guided towards the higher end of its long-term margin range, with a reported EBIT margin of around 4% and adjusted EBITDA margin of around 6%, compared with the earlier guidance range of 5-6%.
As reported by The Financial Express, Eternal is widening Blinkit's addressable market through new premium offerings rather than relying solely on discounting. Management has started rolling out Gourmet stores across select locations in the top eight cities to strengthen Blinkit's premium assortment. The brokerage highlighted that customer cohorts acquired three years ago now spend around three times what they did when they first joined the platform, which management cited as evidence that retention rather than discounting is driving long-term value creation. Jefferies noted that the company's Going-out business recorded 60% year-on-year growth in NOV, while Hyperpure's like-for-like revenue increased 27% year on year. CLSA has maintained its positive view with a target price of ₹506 (65% upside), noting that newer businesses such as District and Bistro continue to expand the ecosystem and drive customer engagement.
According to reports from The Financial Express, Jefferies retained its 'Buy' rating on Eternal and increased its target price to ₹415 from ₹400. The brokerage values Eternal using a sum-of-the-parts methodology, assigning a 40x September 2028 EBITDA multiple to the food delivery business, 1.2x September 2028 revenue to Blinkit and 1.5x gross order value to the Going-out business. Following the quarterly performance, Jefferies increased its adjusted EBITDA estimates for FY27 through FY29 by 2% to 5%, with stronger profitability in Blinkit and sustained momentum in food delivery as the primary reasons behind the revisions. Motilal Oswal maintained its positive view with a target price of ₹400, implying 41% upside, noting that management's long-term target of 60% NOV growth and an EBITDA target of $1 billion by FY29 appear increasingly achievable.
