Motilal Oswal Financial Services has reiterated its ‘Buy’ call on Eternal (Zomato), with a target price of Rs 380, implying a 34% upside. The brokerage expects the current market price to offer an effective entry point for a long-term opportunity. Additionally, it has highlighted “three growth engines.”
Recovery and stability in food delivery
Eternal’s food delivery business has witnessed accelerated growth for three consecutive quarters, driven by targeted interventions for budget-conscious customers, such as “Gold” member benefits and curated affordable meal offerings (example meals under Rs 250). Motilal Oswal continues to view this segment as a stable duopoly and expects it to maintain a medium-term growth rate of approximately 18–20%.
Blinkit as a “Generational Opportunity”
The second engine is the Quick Commerce segment. Despite intensifying competition from players like Zepto, Blinkit continues to strengthen its position. It has successfully crossed adjusted EBITDA breakeven, with mature markets like Delhi NCR delivering 5–6% EBITDA margins. Its dark store network is the largest in the industry, with a target to reach 3,000 stores by March 2027.
“District” as a potential dark horse
Lastly, Motilal Oswal identified Eternal’s nascent “going-out” business, District, as a significant long-term opportunity focusing on India’s growing concert economy. Successful scaling of this segment could potentially contribute almsot $125 million to EBITDA by FY30.
“Eternal is a play on the discerning, affluent urban consumer’s wallet share, and to this effect, its bet on District deserves a look as well. We believe India’s concert economy could grow 2–2.5x over the next five years, creating a meaningful long-term opportunity for District,” said Motilal Oswal.
To give context, India’s live events market is already Rs 20,000-22,000 crore, with concerts growing 18-20% annually and ticketing contributing 50-60% of event revenue.
Ambitious financial guidance
The company has set a goal of $1 billion in adjusted EBITDA for its consolidated business by FY29. Motilal Oswal estimates that this will be driven by nearly $500 million from Quick Commerce and $425 million from Food Delivery, with the remainder coming from segments like District and Hyperpure.
Eternal share price performance
The share price of Eternal has risen 6.5% in the last five trading sessions. The stock has increased 16.4% in the past one month and 2.4% in the last six months. Eternal’s share price has given a return of almost 12% over the previous 12 months.
Eternal Q4FY26
The food delivery company posted a jump of 346% year-on-year net profit at Rs 174 crore in the fourth quarter of FY26, compared with Rs 39 crore in the same period a year ago.
Its revenue from operations surged 196% YoY to Rs 17,292 crore in Q4, as against Rs 5,833 crore in the corresponding period a year ago.
For the whole of FY26, the net profit came in at Rs 366 crore, compared to Rs 351 crore in the previous fiscal.
Disclaimer: This article provides factual analysis only and is not, and should not be construed as, an offer, solicitation, or recommendation to buy or sell securities. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor.