💰 Financial Performance

Revenue Growth by Segment

Food delivery Net Order Value (NOV) grew 14% YoY in Q2FY26. Quick commerce NOV growth accelerated to 137% YoY (27% QoQ), with like-for-like revenue growing 171% YoY. Hyperpure core restaurant business grew 42% YoY (15% QoQ) to INR 940 Cr, while non-restaurant revenue declined 94% QoQ to INR 83 Cr. Going-out NOV grew 32% YoY.

Geographic Revenue Split

Not explicitly disclosed by percentage; however, the company operates across India with a focus on tier-one markets and is expanding into new cities to drive a weighted average Adjusted EBITDA margin.

Profitability Margins

Food delivery Adjusted EBITDA margin reached an all-time high of 5.3% of NOV. Quick commerce Adjusted EBITDA margin improved to -1.3% from -1.8% QoQ. Hyperpure core restaurant business margin improved to -0.9% from -2.2%. Going-out Adjusted EBITDA margin declined to -3.1% due to category creation investments.

EBITDA Margin

Consolidated Adjusted EBITDA for food delivery was over INR 500 Cr in Q2FY26 (up from INR 451 Cr in Q1FY26). Quick commerce saw a 300 bps increase in Gross Profit as a % of NOV due to the shift to an inventory-led model, though net margin gain is expected to be 1% over 4-6 quarters.

Capital Expenditure

Investment of INR 758 Cr for secondary share purchase and INR 1,260 Cr primary infusion into OTPL and WEPL for the 'Movies Ticketing' and 'Events' business acquisition. Accelerated store expansion aims for 2,100 stores by Dec 2025 and 3,000 stores by Mar 2027.

Credit Rating & Borrowing

Not disclosed in available documents; however, the company maintains a 'strong balance sheet' to fund growth and sacrifices short-term margins for market share.

⚙️ Operational Drivers

Raw Materials

Inventory for quick commerce (groceries and consumer goods) and food supplies for Hyperpure represent the primary cost of goods sold. In Q2FY26, Hyperpure revenue (including inventory sales) was INR 1,023 Cr.

Import Sources

Sourced domestically within India from various brands and producers to supply the Hyperpure restaurant base and Blinkit's dark store network.

Key Suppliers

Direct contracts with FMCG brands for the 1P (inventory) quick commerce model and various food producers/vendors for the Hyperpure business.

Capacity Expansion

Current quick commerce network stands at 1,816 stores as of Q2FY26. Planned expansion to 2,100 stores by December 2025 and 3,000 stores by March 2027 to fulfill higher demand.

Raw Material Costs

Cost of goods sold is now a major component in quick commerce due to the shift to inventory ownership. This shift led to a 3% gross profit increase as a % of NOV, partially offset by first-mile supply chain costs.

Manufacturing Efficiency

Not applicable as a service/platform business; however, operational leverage is being sought in marketing, where 4x YoY spend in QC is expected to yield better efficiency as the user base grows.

Logistics & Distribution

Delivery and related charges were INR 1,128 Cr in Q2FY26. Distribution costs are impacted by the 'first mile' bit now being borne by Blinkit rather than sellers under the new 1P model.

📈 Strategic Growth

Expected Growth Rate

20%

Growth Strategy

Achieving growth through 4x YoY marketing spend to acquire new users, expanding the Blinkit store network to 3,000 by 2027, and the acquisition of Paytm's ticketing and events business (District) to create new use cases. The company is also increasing platform fees in food delivery to improve profitability while maintaining a 15% growth rate in the near term.

Products & Services

Food delivery services, quick commerce grocery delivery (Blinkit), B2B restaurant supplies (Hyperpure), and movie/event ticketing (District).

Brand Portfolio

Zomato, Blinkit, Hyperpure, District.

New Products/Services

Launch of 'District' for going-out use cases (movies, events) following the INR 2,018 Cr acquisition of ticketing businesses. Expected to maintain a 30% YoY growth trajectory.

Market Expansion

Aggressive expansion of dark stores in existing and new cities, targeting 2,100 stores by Dec 2025 to capture quick commerce market share.

Market Share & Ranking

The company is a leader in food delivery and quick commerce, reacting to competitor platform fee increases to maintain margin leadership.

Strategic Alliances

Acquisition of 'Movies Ticketing' and 'Events' businesses from One 97 Communications Limited (Paytm) for a total consideration of approximately INR 2,018 Cr.

🌍 External Factors

Industry Trends

The industry is shifting toward quick commerce (10-minute delivery) and inventory-led models (1P) to capture higher margins. Eternal is positioning itself by expanding its store network to 3,000 and integrating ticketing services to own the 'going-out' category.

Competitive Landscape

Intense competition in quick commerce and food delivery; margins are influenced by competitor pricing and platform fee structures.

Competitive Moat

Moat is built on a massive delivery network, brand recognition (Zomato/Blinkit), and high switching costs for 'Gold' members. The network effect of 1,816+ stores provides a significant barrier to entry in quick commerce.

Macro Economic Sensitivity

High sensitivity to discretionary spending; soft demand in India has recently acted as a headwind, keeping food delivery growth at 15% vs the 20% long-term target.

Consumer Behavior

Shift toward 10-minute delivery for a wider variety of categories beyond groceries, including high-margin electronics and beauty products.

Geopolitical Risks

Minimal direct exposure, but global supply chain disruptions could impact the availability of certain FMCG goods sold via quick commerce.

⚖️ Regulatory & Governance

Industry Regulations

Subject to GST regulations; the company has received orders from GST authorities regarding tax on delivery charges, which it is contesting.

Environmental Compliance

Not explicitly disclosed in financial snippets.

Taxation Policy Impact

Current tax expense was INR 80 Cr for Q2FY26. The company utilizes carried forward losses to set off business income tax liabilities.

Legal Contingencies

Pending GST disputes regarding delivery charges; the company believes it has a strong case on merits but the outcome remains uncertain. Total assets of unreviewed subsidiaries stand at INR 2,165 Cr.

⚠️ Risk Analysis

Key Uncertainties

Macroeconomic slowdown impacting discretionary spend (potential 5-10% impact on growth), and the execution risk of scaling to 3,000 stores by 2027.

Geographic Concentration Risk

Highly concentrated in Indian urban centers; tier-one markets drive the bulk of NOV and Adjusted EBITDA.

Third Party Dependencies

Increasing dependency on direct brand relationships for the 1P quick commerce model and delivery partner availability.

Technology Obsolescence Risk

Low risk; the company is a digital-first leader, though it must constantly evolve its app and supply chain algorithms to maintain 10-minute delivery.

Credit & Counterparty Risk

Trade receivables stood at a level requiring a provision for doubtful debts of INR 6 Cr in Q2FY26, indicating generally high quality of receivables.