Eternal Ltd. (formerly Zomato) made headlines once again, but this time, for not so good reasons. After announcing its Q4 results for the financial year 2024–25, Eternal’s share price dropped over 5% during early trading hours on Friday, falling to ₹220.10 on the BSE.
But behind that single-digit drop lies a much bigger story of profit declines, rapid expansion, fierce competition, and what that means for the average investor.
Let’s break it down.
Q4 FY25 performance at a glance
Here’s how the company performed in the fourth quarter of FY25:
| Metric | Q4 FY25 | Q4 FY24 | Change |
| Net Profit | ₹39 crore | ₹175 crore | ▼ 78% |
| Revenue from Operations | ₹5,833 crore | ₹3,559 crore | ▲ 64% |
| Adjusted EBITDA | ₹165 crore | ₹195 crore | ▼ 15% |
| Gross Order Value (Food Delivery) | ₹9,778 crore | ₹8,439 crore | ▲ 15.8% YoY, ▼ 1.3% QoQ |
| Quick Commerce Revenue (Blinkit) | ₹1,709 crore | ₹769 crore | ▲ 122% |
| Cash Balance | ₹18,824 crore | ₹19,235 crore | ▼ ₹411 crore |
So, while revenue and Blinkit’s growth impressed, profitability took a beating.
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What’s driving the drop in net profit?
The headline figure that shocked the market: Eternal’s net profit fell by 78% year-on-year in Q4 FY25. That’s not a small miss. From ₹175 crore last year, the number dropped to ₹39 crore.
Even though revenues surged, this dip in profit was largely due to:
- A 68% rise in total expenses, mostly from Blinkit expansion and higher infra costs.
- Growing customer acquisition costs.
- Accelerated dark store openings 294 added just in Q4, a record.
Analysts pointed out that the focus on expansion, especially in the quick commerce (QC) space, was cannibalising short-term profitability.
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Food delivery is stable
Eternal’s core food delivery business didn’t do too badly in terms of revenue, clocking ₹2,409 crore, up 17.5% YoY. But the Gross Order Value (GOV) for this segment declined 1.3% QoQ, showing signs of fatigue.
Reasons?
- A sluggish demand environment.
- A temporary shortage of delivery partners.
- Rising competition, not just from other players, but from packaged food delivery models.
Even with Blinkit’s high growth, the margin story is what’s giving investors pause.
Also read: India’s Top E-Commerce Stocks for 2025
Blinkit’s explosive growth, but at what cost?
Blinkit continues to be Eternal’s fastest-growing segment:
- Revenue: ₹1,709 crore, up 122% YoY.
- Net Order Value: â–² 53% YoY, â–² 19% QoQ.
- Store additions: 294 net new stores in Q4 alone.
But these impressive numbers come with a cost. Blinkit’s adjusted EBITDA margin as % of GOV dropped from -1.3% in Q3 to -1.9% in Q4, reflecting higher losses. Total EBITDA-level loss for Blinkit hit ₹178 crore in Q4, a sharp fall from where it stood earlier in the year.
And Eternal isn’t hitting the brakes. It’s targeting 2,000 Blinkit stores by December 2025.
What are brokerages saying?
Despite the mixed bag of numbers, most brokerages remain optimistic about the Eternal share price:
| Brokerage | Rating | Target Price |
| Emkay Global | Buy | ₹290 |
| Motilal Oswal | Buy | ₹260 |
| Nomura | Buy | ₹280 |
| Nuvama | Buy | ₹290 |
| ICICI Securities | Buy | ₹310 |
| Citi, JPMorgan | Buy | ₹250–₹290 |
| Jefferies | Hold | Not disclosed |
Analysts believe that the expansion pain will likely moderate in the coming quarters, and margins should stabilise as store efficiency improves.
Still, most expect the Eternal share price to remain range-bound in the near term due to increased competition and high upfront investment in the QC segment.
Also read: Reliance Industries’ Q4 results analysis
Shutdowns and strategic pivots
In an interesting twist, Eternal also announced the closure of its Zomato Quick and Zomato Everyday verticals, citing the inability to chart a path to profitability in those formats without compromising user experience.
This signals a sharper focus: double down on what’s scaling fast (Blinkit), cut what isn’t moving the needle.
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So, should you buy Eternal shares now?
Here’s the real dilemma. Eternal has cash in hand (₹18,824 crore), strong topline growth, and a rapidly scaling QC vertical. But its profitability is under pressure, and it’s making big bets in a highly competitive segment.
If you’re a long-term investor who believes in the future of food delivery and quick commerce, Eternal’s share price levels might look attractive for accumulation. But if you’re looking for short-term gains, the volatility and margin stress may make you cautious.
Ultimately, it’s a question of time horizon and risk appetite.
Eternal is playing the long game. Whether that pays off will depend on how fast Blinkit turns profitable and how well Eternal manages to keep scaling without burning out. Investors should watch upcoming quarters closely, because this story is just heating up.
