Food delivery major Eternal’s share price surges over 5%; here’s what’s driving the rally

The share price of Eternal, formerly known as Zomato, surged sharply on Thursday, rising over 5% in early trade. The stock opened at ₹248 and climbed to ₹259.70 by 11:53 a.m., marking a gain of ₹14.02 or 5.71% from the previous close of ₹245.68. It touched an intraday high of ₹260.22, just shy of its 52-week peak. The market capitalisation stood at ₹2.36 lakh crore. The stock has also bounced significantly from its 52-week low of ₹209.86.

As of 12:40 p.m., the Eternal share price was trading at ₹259.80 on the BSE, up ₹13.60 or 5.5%.

Morgan Stanley's endorsement of Eternal as its top sector pick has emerged as a major driver behind the recent surge in the company’s stock. The global brokerage house praised Eternal’s dominant position in both food delivery and quick commerce, backed by a lean cost structure and a solid balance sheet. These strengths, it noted, reduce the likelihood of future equity dilution—a key concern for investors.

The brokerage has retained its price target of ₹320 for Eternal, implying an upside of around 33% from the current levels. At the same time, it expects the stock to find support in the ₹200-220 range, framing an attractive risk-reward proposition for potential buyers.

According to the brokerage house Anand Rathi, the scrip is showing considerable bullish momentum at the moment.

“Eternal has successfully breached its long-standing resistance at ₹245 and is now sustaining above this crucial level, signaling strength and potential for further upside. On the momentum front, the daily RSI has held firm above the 50-mark and is currently hovering near 66, suggesting bullish momentum is intact,” the brokerage house said in a note.

In broader market action, the Sensex began the day on a strong note, rising by 238.01 points to touch 81,434.09, marking a 0.54% gain. Although the index has slipped 1.09% over the past three weeks, it continues to trade above its 50-day moving average, which itself stands higher than the 200-day moving average, indicating continued bullish momentum.

The company stated that it would continue to aggressively chase market share in quick commerce, ensuring that near-term profit goals don’t come in the way of long-term growth. For FY25, Eternal has reported a net profit of ₹527 crore (up 50.1% YoY) and revenue from operations of ₹20,243 crore (up 67.1% YoY), stated the SMC report.