Eternal shares jump 7% on Blinkit EBITDA breakeven; investors assess post-Deepinder era

Ending a three-session losing streak, shares of Eternal rallied over 7% in early trade on Thursday as investors cheered its better-than-expected December quarter earnings. The parent of food delivery major Zomato posted strong Q3 results, driven by its quick commerce arm Blinkit and B2B supplies business Hyperpure, both of which turned profitable for the first time.

Buoyed by the Q3 performance, Eternal shares surged as much as 7.3% to an intraday high of ₹304.20 in early trade, after closing nearly 4% lower in the previous session. Over the past three sessions, the technology stock had declined nearly 10% amid concerns over profitability, elevated debt levels, and intensifying competition in the quick commerce space.

At the time of reporting, Eternal shares were trading 1.2% higher at ₹286.75, with a market capitalisation of ₹2.77 lakh crore. Around 25 lakh shares had changed hands in the first hour of trade compared to two-week average volume of 23.42 lakh scrips.

The stock had touched its all-time high of ₹368.40 on October 16, 2025, and a 52-week low of ₹189.60 on April 7, 2025. While the large-cap stock has gained about 33% over the past year, it is down more than 4% over the last six months. The counter has delivered largely flat returns to shareholders over the last one month.

Robust Q3 fuelled rally

Eternal’s consolidated net profit for the December quarter surged 73% year-on-year to ₹102 crore, compared with ₹59 crore in the corresponding quarter of the previous financial year. Revenue from core operations jumped 201% to ₹16,315 crore in Q3FY26, up from ₹5,405 crore a year earlier.

Adjusted EBITDA rose 28% to ₹364 crore during the quarter. Business-to-consumer net order value (NOV) climbed 55% YoY to ₹25,732 crore, taking the annualised run rate beyond the ₹1 lakh crore mark.

According to the company, Blinkit, its fastest-growing vertical, reported a positive adjusted EBITDA of ₹4 crore in Q3FY26. Hyperpure, which supplies ingredients and kitchen essentials to restaurants, also turned profitable, posting a net profit of ₹1 crore after being loss-making until the previous quarter.

In a key leadership development, founder Deepinder Goyal stepped down as Group CEO of Eternal, stating that he seeks the freedom to pursue “significantly higher-risk” ideas that no longer align with the strategic framework of a listed entity. In a post on X addressed to shareholders, Goyal said he would continue on the board as vice chairman, subject to shareholder approval, while Blinkit CEO Albinder Dhindsa will take over as the new Group CEO, effective February 1, 2026.

Analysts remain bullish

Following the Q3 earnings announcement and a key leadership transition, brokerages have largely remained bullish on Eternal, citing its market leadership in both quick commerce and food delivery, and the long-term optionality in Blinkit, which many view as a generational opportunity in grocery, retail, and ecommerce disruption.

Motilal Oswal maintained its ‘Buy’ rating, noting that the food delivery business remains stable, while Blinkit offers a long-term opportunity to participate in the disruption of retail, grocery, and ecommerce. However, the brokerage cautioned that while food delivery growth is recovering, the pace of normalisation remains gradual. It also expects the recent EBITDA relief in Blinkit to be short-lived, as competitive intensity in quick commerce re-accelerates.

On the leadership transition, Motilal Oswal said the CEO change appears orderly, though the division of responsibilities between management and the board remains unclear at this stage. “While we believe day-to-day execution is unlikely to be disrupted, the change does introduce some uncertainty to the business,” it said.

JM Financial reiterated its ‘Buy’ rating on Eternal, with an unchanged target price of ₹400. The brokerage broadly maintained its net order value (NOV) and EBITDA estimates for Zomato’s food delivery business, while trimming FY27-FY28 estimates by 5-6% to account for sustained competitive intensity over the medium term. At the same time, JM Financial raised Blinkit’s margin estimates by 20-45 basis points over FY26-FY28, citing better-than-expected operating leverage in Q3FY26.

For Hyperpure, JM Financial increased revenue estimates by 6-25% and raised adjusted EBITDA margin assumptions by 35-196 basis points, in line with management’s medium-term guidance. On the leadership change, the brokerage said the transition is expected to be smooth, as it elevates a leader with a proven track record of scaling a business that now represents the cornerstone of Eternal’s future growth.

Emkay Global also retained its ‘Buy’ rating but cut its target price by around 14% to ₹370, from ₹430 earlier. The brokerage said Q3FY26 results surprised positively on profitability, though NOV growth fell short of expectations, rising 13.9% quarter-on-quarter versus the Street estimate of 18.9%. Food delivery performance was broadly in line with expectations.

Emkay noted that Blinkit prioritised profitability over growth during the quarter and reiterated its view that during a “land-grab” phase, companies should focus on market share over near-term margins to build scale that can be monetised over time. While the brokerage acknowledged that quick commerce can be highly profitable at scale and that Blinkit’s execution remains strong, it expects competitive intensity in the segment to intensify, potentially slowing margin expansion.

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