Synopsis: Axis Capital sees Eternal stock as an attractive buy, with Blinkit as the core value driver. Strong quick-commerce growth, healthy long-term outlook, and margin expansion underpin a potential 118 percent upside.
The article outline the rationale on the upside of this company, which manages a diversified ecosystem including the Zomato food delivery app, Blinkit (quick commerce), District (events), and Hyperpure (B2B supplies)
With a market capitalization of Rs 2,13,514 crore, Eternal Ltd’s share closed at Rs 221.25 per share, down by 1.14 percent from its previous day’s close price . The share of this company has given a return of 7.51 percent over the last 1 years
Brokerage’s View
Axis Capital maintains a ‘Buy’ rating on the stock, setting a target price of Rs 484, signalling a potential upside of approximately 118 percent from current levels, reflecting strong confidence in future growth.
Attractive Entry Point: The brokerage views the current market correction as an overreaction to short-term fears, presenting an attractive entry point for investors. Despite minor fundamental deterioration, valuations have softened, offering potential upside for those looking to invest in a high-growth quick-commerce business like Eternal at a discounted level.
Healthy Long-Term Growth Outlook: The long-term growth outlook remains healthy, with valuations reflecting a 32 percent CAGR in net order value from FY26 to FY30. Structural growth drivers in the food delivery and quick-commerce segments, including urban penetration and increasing consumer adoption, are expected to underpin strong top-line performance for the foreseeable future.
Gradual Margin Expansion: Margin expansion is expected to be gradual but meaningful. Axis Capital projects adjusted EBITDA margins of 2.7 percent by FY30, reaching steady-state levels of 5–6 percent by FY35. Operating leverage, cost efficiencies, and scale benefits from expanding the quick-commerce network will drive incremental profitability over the medium term.
Incorporated in 2010, Zomato Limited is one of the leading online Food Service platforms in terms of the value of food sold. Its offerings include food delivery, dining-out services, Loyalty programs, and others. It manages a diversified ecosystem including the Zomato food delivery app, Blinkit (quick commerce), District (events), and Hyperpure (B2B supplies).
Financial Highlights: The revenue from operations grew by 202 percent to Rs 16,315 crore in Q3 FY26 from Rs 5,405 crore in Q3 FY25, and EBIDT grew by 127 percent to Rs 368 crore in Q3 FY26 from Rs 162 crore in Q3 FY25. Accompanied by a net profit growth of 73 percent to Rs 102 crore in Q3 FY26 from Rs 59.0 crore in Q3 FY25, resulting in an EPS growth of 83 percent to Rs 0.11 per share in Q3 FY26.
Written by Gourav Pratap Singh
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