The shares of online delivery player Eternal (formerly Zomato) rose over 1 percent on May 2, a day after the company released its results for the January-March quarter of financial year 2025. At 10 am, the shares of the company were trading at Rs 236 apiece.
Shares of Eternal, which officially changed its name from Zomato in March, had more than doubled in each of the last two years, partly fueled by optimism around Blinkit's success.
Eternal had reported a 78 percent year-on-year fall in net profit to Rs 39 crore for Q4 FY25. This marked a sharp fall from the Rs 175 crore net profit reported in Q4 FY24. Its revenue from operations however surged 64 percent YoY to Rs 5,833 crore.
The company's management said that aggressively growing its market share is the goal, and not short-term profitability. It also announced the closure of its 15-minute food delivery service 'Quick' and home-style meal delivery service 'Everyday' as they couldn’t see "the path to profitability in these without compromising on customer experience".
What do brokerages say?
Despite the sharp fall in net profit, Motilal Oswal reiterated its 'Buy' call on the stock, with a target price of Rs 260 per share. This implies nearly 12 percent upside from the stock's previous closing price of Rs 232.5 per share. "We reiterate our BUY rating on the stock, supported by Eternal’s market leadership in both QC and Food Delivery, and the long-term potential of Blinkit as a generational opportunity in retail, grocery, and e-commerce disruption," the domestic brokerage said.
Elara Capital also maintained its 'Buy' call on the stock, with a target price of Rs 300 per share. This implies a higher upside potential of over 29 percent from the previous closing price. According to the note cited by ET Now, the brokerage expects Eternal to maintain its market leadership.
Bajaj Broking Research also kept a 'Buy' rating with a target price of Rs 255 apiece, as per TOI.
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