Eternal shares in focus after Thursday's fall; analysts project upside despite near-term concerns

Shares of Eternal Ltd., the parent company of food delivery platform Zomato and quick commerce player Blinkit, will continue to remain in focus after the company announced its quarterly results on October 16.

The stock initially spiked after strong revenue growth from its Quick Commerce business. However, gains quickly faded when management indicated that growth in the Food Delivery segment is expected to remain "slow" in the near term.

Hong Kong-based brokerage CLSA maintained its 'High Conviction Outperform' rating on Eternal with a price target of ₹450.

The brokerage mentioned that the company reported much stronger-than-expected Q2FY26 net order value (NOV) for Blinkit, along with higher contribution despite the acceleration in stores, users, orders, and average order value (AOV).

It added that Blinkit's adjusted EBITDA was lower than anticipated, largely due to the pace of new customer acquisitions. Eternal said its target of 3,000 dark stores remains conservative, and it is confident of doubling NOV in FY27.

HSBC also has a 'Buy' rating on the stock with a price target of ₹390. The brokerage said food recovery remains slow despite increased spending, but margins improved due to higher take rates.

It added that the Quick Commerce business saw further acceleration in Q2, though margins were affected by elevated marketing and expansion costs.

While valuations are no longer undemanding, HSBC believes strong industry tailwinds and solid execution support its positive view.

Nomura, too, retained its 'Buy' rating with a target price of ₹370, citing that the inventory-led Quick Commerce model is gaining traction, with store additions likely to remain elevated.

The company expects NOV growth of 15% in FY26E and 20% in the medium to long term, as growth momentum picks up in the coming quarters.

Eternal shares ended Thursday's session down 3.91% at ₹340.50. The stock, which hit record highs recently, has surged ninefold from its July 27, 2022 low of ₹40.