Shares of foodtech giant Eternal surged as much as 14.8% on Tuesday, hitting a fresh 52-week high of INR 311.60, buoyed by investor optimism following Zomato’s robust revenue growth in Q1 FY26. Eternal, which owns Zomato, saw its stock rally sharply in early trade, mirroring the positive sentiment around the quick-commerce and food delivery space.
By 11:11 AM, the stock had pared some gains but was still trading 8.6% higher at INR 294.55. At this level, Eternal’s market capitalisation stood at an impressive INR 2,85,602.13 crore, supported by a strong trading volume of 14.8 crore shares. The session’s upper circuit limit was set at INR 311.85, nearly matching the day’s intraday high.
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Q1 FY26 Financial Results: Profit Declines Despite Revenue Growth
Just a day prior to the rally, Eternal reported its consolidated financial results for Q1 FY26, posting a net profit of INR 25 crore. This marked a steep 90% year-on-year (YoY) decline and a 36% drop quarter-on-quarter (QoQ). Despite the drop in profits, Eternal’s revenue performance exceeded expectations, providing a boost to investor confidence.
The sharp decline in profit was attributed to the company’s ongoing investments in Blinkit, its quick-commerce arm, which has been expanding aggressively across metros and tier-1 cities. While the profitability took a hit, analysts noted that Blinkit’s rapid growth and improving delivery metrics could become a future growth engine for Eternal.
Zomato Drives Investor Optimism
Zomato, one of Eternal’s flagship platforms, played a pivotal role in driving the stock up. On Monday, Zomato’s stock had witnessed a surge following its Q1 FY26 results, which showed strong revenue growth despite falling short on profit expectations. The market interpreted the revenue growth as a sign of underlying business strength and potential margin improvement in the coming quarters.
The ripple effect was seen on Eternal’s stock, as investors grew more optimistic about the group’s long-term strategy and scale-up of quick commerce through Blinkit. Many market participants believe that Blinkit could soon rival competitors in the instant delivery space and contribute significantly to Eternal’s top line.
Analysts Weigh In: Long-Term Potential vs. Short-Term Pressure
While the near-term profit pressure remains a concern, many analysts have retained a bullish outlook on Eternal, citing:
- Strong brand equity in India’s growing food delivery and quick commerce market
- Diversified business segments under Eternal’s umbrella
- Improving unit economics in Blinkit
- Ongoing shift in consumer behavior toward convenience and speed
However, some experts also caution that Eternal will need to balance its burn rate in Blinkit with sustainable profit metrics to avoid prolonged pressure on its bottom line.
Conclusion
Eternal’s stock performance highlights investor confidence in the long-term growth of foodtech and quick commerce in India. While the Q1 FY26 profit numbers were underwhelming, the strong rally suggests that the market is focusing more on revenue growth and future scalability. With Zomato and Blinkit driving momentum, Eternal seems poised to maintain investor interest in the months ahead.
