Detailed Coverage

Eternal Ltd Reports Strong Q1FY27 Growth

Consolidated Adjusted Revenue: ₹20,648 crore
Consolidated Adjusted EBITDA: ₹555 crore

Reader Takeaway: Rapid revenue growth and quick commerce profitability is positive, but capital intensity and GST litigation pose challenges.

What just happened

Eternal Limited, formerly known as Zomato Limited, announced its financial results for the first quarter of Fiscal Year 2027 (Q1FY27). The company posted a consolidated adjusted revenue of ₹20,648 crore, marking a significant 173% year-on-year increase. Consolidated adjusted EBITDA saw a substantial rise of 223% to ₹555 crore.

Why this matters

The strong revenue growth and improved profitability, especially the turnaround in the Quick Commerce segment, indicate effective execution of the company's strategy. The positive EBITDA from Quick Commerce, which is a key growth driver, is a significant milestone. However, the capital-intensive nature of this segment and ongoing GST litigation require careful monitoring by investors.

The backstory

Eternal Limited, previously Zomato, has been strategically expanding its quick commerce operations alongside its core food delivery business. The company has been investing heavily in warehousing and logistics to support this expansion. Recently, the company officially changed its name from Zomato Limited to Eternal Limited to reflect its multi-business focus.

What changes now

The transition of the Quick Commerce business (Blinkit) to profitability is a major shift. This segment achieved an Adjusted EBITDA of ₹102 crore, a significant improvement from a loss of ₹162 crore in the prior year's comparable period. The company added 200 new stores, bringing its total Quick Commerce store count to 2,443.

Risks to watch

Eternal Limited faces potential future liabilities from GST litigation amounting to ₹420 crore, ₹14 crore, and ₹13 crore related to delivery charges, which the company is contesting. The capital-intensive quick commerce model, requiring substantial investment in warehousing, and evolving regulations around gig workers are also key watch points.

Peer comparison

Eternal Limited's quick commerce segment growth (86% YoY NOV growth) is outperforming many players in the rapidly expanding rapid delivery market. While specific peer profitability figures for this exact quarter are not detailed here, Eternal's achievement of positive EBITDA in quick commerce is a notable step.

Context metrics (time-bound)

• Food Delivery NOV: ₹10,769 crore (20% YoY growth), with a 5.6% Adjusted EBITDA margin.
• Quick Commerce NOV: ₹17,132 crore (86% YoY growth), achieving ₹102 crore Adjusted EBITDA.
• Going-out NOV: ₹3,218 crore (60% YoY growth), with a reduced Adjusted EBITDA loss of ₹65 crore.
• Hyperpure (B2B) Revenue: ₹1,034 crore, with ₹6 crore Adjusted EBITDA.
• Closing Cash Balance: ₹18,288 crore.

What to track next

Investors should closely monitor the company's ability to sustain profitability in the quick commerce segment, manage its significant capital expenditure, and navigate the ongoing GST litigation. The effectiveness of its inventory-led model and its impact on revenue reporting will also be crucial to watch.