Eternal shares rise 4% after shareholding data fuels MSCI weightage expectations
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Shares of Eternal Ltd., the parent company of food delivery platform Zomato and quick commerce player Blinkit, climbed as much as 4% on Tuesday, extending gains for a fifth consecutive session after the company disclosed an improvement in its foreign shareholding headroom.
The rally followed the release of Eternal’s latest shareholding pattern late on Monday, which showed an increase in foreign ownership limits. Based on the updated data, foreign headroom has risen above the 25% threshold, making the stock eligible for full MSCI weightage, according to a sales note.
At 11:51 AM on Tuesday, the shares of the company were trading 3% higher at ₹ 294.20 apiece on the BSE.
Eternal stock has rebounded sharply
Eternal shares had seen some correction in recent weeks, slipping about 2% over the past month. However, the stock has rebounded sharply, rising more than 4% in the last five trading sessions and over 8% during the past month.
The company currently commands a price-to-earnings multiple of 1,464 and a market capitalisation of approximately ₹2.83 lakh crore. On Tuesday, it emerged as the top gainer on the benchmark Sensex and Nifty indices.
Analysts said the potential increase in MSCI weightage could be reflected in the February MSCI review, which may trigger passive inflows of around $390 million.
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The stock had earlier corrected from record highs amid concerns over the profitability of its quick commerce business and intensifying competition. Despite these concerns, brokerages remain largely optimistic. HSBC reiterated its positive stance on Monday, assigning a price target of ₹350, while JM Financial maintained a more aggressive target of ₹400.
Overall analyst sentiment remains bullish, with 29 of the 33 analysts tracking Eternal recommending a “buy,” while four have a “sell” rating.
Meanwhile, broader markets were volatile on Tuesday. The Nifty hovered near the 25,750 mark, down about 50 points, while the Nifty Bank index bucked the trend with gains of around 100 points. L&T, HCL Technologies, Dr Reddy’s, Cipla, Bharti Airtel, Trent and Reliance Industries were among the major laggards. The Sensex was down around 0.1% at 83823 points while the Nifty50 was trading at 25754, down 0.1%.