Eternal’s revenue soars 172% YoY in Q2; quick commerce, UAE expansion drive growth

Eternal Ltd posted a strong performance in the September quarter (Q2FY26), led by robust growth across its quick commerce and food delivery businesses. Consolidated adjusted revenue jumped 172% year-on-year (85% sequentially) to ₹13,968 crore, while B2C net order value (NOV) surged 57% YoY to ₹23,164 crore.

“In line with our expectation, NOV growth rate (YoY) did go up in Q2FY26 after declining consistently for the last five quarters. Having said that, the recovery in growth has been slower than expected and we only expect a slow uptick in growth rate in the near term,” said Deepinder Goyal, founder & CEO, Eternal in the shareholders' letter.

He added, “While we continue to work on inputs to the business (making restaurant food more accessible and affordable for customers), we are also constantly fighting multiple headwinds including soft discretionary consumption in general in India, the impact of quick commerce growth and increasingly volatile weather (extreme heat, extended rains), which continue to weigh on near term growth.”

However, despite the topline surge, profitability moderated. Eternal reported a 63% year-on-year (YoY) decline in quarterly profit after tax (PAT) at ₹65 crore in the second quarter (Q2) of FY26, down from ₹176 crore in the same period a year ago.

Eternal’s shares fell 1.73% to close at ₹348.40 apiece on the BSE today, down from the previous session’s ₹354.55. At this price, the company’s market capitalisation stands at ₹3.36 lakh crore.

Q-commerce fuels growth

The company’s quick commerce arm recorded its highest growth in ten quarters with NOV up 137% YoY (27% QoQ). Eternal added 272 new stores during the period, taking the total count to 1,816, and now plans to reach 2,100 stores by December 2025, higher than its earlier target of 2,000, and 3,000 by March 2027.

The transition to an own-inventory model is almost complete, with around 80% of NOV in Q2 coming from owned inventory. 

“We have transitioned most of the business to own inventory model, barring a few categories where we don’t plan to own inventory as of now for various reasons. As a result, in Q2FY26 about 80% of the NOV was on our own inventory which is expected to go to a steady state number of about 90% in the next quarter,” said Akshant Goyal, chief financial officer, Eternal. He added that this transition is expected to result in a net margin expansion of about one percentage point over the next four to six quarters.

Quick commerce adjusted EBITDA margin (as a percentage of NOV) improved to -1.3% from -1.8% in Q1FY26.

 “We have been maintaining our quarterly rate of net store additions consistently for the last few quarters, and given what we know today, we think we should be able to get to 3,000 stores by Mar 2027,” said Albinder Dhindsa, founder & CEO, Blinkit.

Food delivery stabilises; margins at record high

Meanwhile, the company’s food delivery business showed signs of recovery with NOV growth improving slightly to 14% YoY (from 13% in Q1FY26). Profitability reached an all-time high of 5.3% of NOV, compared with 5.0% in the previous quarter. The business delivered an adjusted EBITDA of over ₹500 crore in Q2, up from ₹451 crore in Q1. 

The company said in the shareholders' letter the ~75 basis point quarter-on-quarter increase in take rate (adjusted revenue as a percentage of NOV) was driven by multiple levers such as ad monetisation, higher commission rates, and an increase in platform fees. However, the rise in take rate did not fully translate into a proportional contribution margin improvement, which increased by only about 50 basis points. 

Eternal attributed this to a decrease in delivery charges as part of its Gold programme, where the minimum order value for free delivery was lowered from ₹199 to ₹99. “This change allows us to also cater to the budget-conscious customer base for whom an order with average order value between ₹99 and ₹199 now becomes way more affordable,” said CFO Goyal.

As a result, the share of low-value, lower-margin orders increased, impacting overall platform profitability in percentage terms, though absolute profits rose, as the incremental orders remained contribution positive. Higher investments in customer activation across cohorts also weighed on contribution margin, contributing to an uptick in average monthly transacting customers (MTCs) to 24.1 million during the quarter, the company added.

Eternal said it remains comfortably within its long-term EBITDA margin guidance range of 5-6%.

The company’s Hyperpure vertical continued to deliver steady gains. The core restaurant business grew 42% YoY (15% QoQ) to ₹940 crore. Adjusted EBITDA margin improved to -0.9% from -2.2% in Q1FY26. Eternal expects Hyperpure to turn profitable over the next two quarters, even as it scales down its non-restaurant business to zero.

District expands

On the “Going-Out” side, Eternal expanded its District platform by adding “Stores” as a new category alongside dining-out, movies, and event ticketing. It onboarded about 3,400 outlets across six cities and enabled over 60,000 transactions. “Our customer base continues to expand rapidly which is giving us the confidence to continue investing in building District as the one-stop destination in India for discovering multiple going-out use-cases,” said Goyal.

Eternal also launched District in the UAE, bringing both dining-out and live events onto a single app. “We chose to expand live events in the UAE because it is a global hub for outdoor entertainment and can potentially turn out to be an attractive market for us. The trust we’ve built with customers and restaurants in the UAE through dining-out gives us a head-start and improves our odds of success there,” Goyal added.

The company said it expects quarterly losses from this new segment to remain rangebound even as it continues to invest in category building.