Eternal Q2 preview: Blinkit drives revenue up 137% year-over-year, but among the rogues, PAT drops by up to 71%. 5 things to watch

Eternal, the parent company of food delivery platform Zomato, is expected to post strong revenue growth in the September quarter, although profitability may decline on a year-on-year basis due to the expansion of its high-speed commerce business and challenges in the core food delivery segment. Higher costs, passenger incentives and higher marketing spend are likely to put pressure on margins.

The company will announce its second quarter figures on Thursday, October 16.

Eternal’s profits could fall up to 71% year-over-year, while revenue could rise up to 137%, according to estimates from four brokers.

Morgan Stanley remains the most optimistic about revenue growth among its peers. BofA, Nuvama Institutional Shares and Bonanza.

Brokers broadly agree that Eternal’s Q2 26 results will underline Eternal’s strong growth trajectory, led by Blinkit and steady food delivery operations. But the profitability story remains weak, with higher costs, rider incentives and marketing spend weighing on margins. Analysts see solid revenue momentum but limited upside in the near term, leaving the outlook cautiously optimistic.

Here’s how these 5 metrics compare to agent expectations:

1) PAT

Eternal’s profitability is expected to remain under pressure last quarter, even as revenue momentum remained strong. This reflects continued margin compression due to higher delivery and ridership costs. BofA estimates profit after tax (PAT) at Rs 52 crore, up 107% sequentially but down 71% year-on-year.

— Bonanza expects PAT to decline 30% year-on-year to Rs 120 crore, highlighting increased customer incentives and intense competition weighing on profits.

2) RevenueEternal’s revenue is expected to show robust growth in the second quarter, driven by strong traction in its fast-paced commercial arm, Blinkit.

— BofA estimates revenue at Rs 8,480 crore, up 77% year-on-year and up 18% quarter-on-quarter.

— Morgan Stanley expects revenue of Rs 12,170 crore, up 137.3% year-on-year and 60.9% quarter-on-quarter.

— Nuvama estimates a 90% year-over-year jump and 27% quarter-over-quarter growth.

— Bonanza expects revenue of Rs 8,600 crore, up 80% year-on-year, led by Blinkit’s rapid growth and improved order frequency in metros and tier-I cities.

3) Food delivery company

BofA expects gross order value (GOV) of Rs 11,340 crore in Q2FY26, up 17% YoY, while Nuvama expects growth of 5% QoQ and 17% YoY.

Morgan Stanley expects monthly transactions (MTU) to increase by 1 million QoQ to 23.9 million, representing 4.4% QoQ growth from Q2 2026. “We expect order frequency in both cases to show some uptick during the quarter, while quarter-on-quarter average order value could be stable, leading to a NOV (net order value) of Rs 95.7 billion for Q2 (+6.7% QoQ, +15.6% YoY),” the broker said.

The US brokerage expects the adjusted EBITDA margin for core food delivery (as % of NOV) to remain flat on a quarterly basis at 4.9% in 2Q26, versus 5% in 1Q26.

Overall, these assumptions push Eternal’s adjusted revenue forecast for the food sector (food delivery + Hyperpure + other, including egress) to Rs 4,730 crore, down 8.4% QoQ, while revenue will rise 19.1% YoY as Hyperpure’s revenues will shift to Blinkit with an increasing mix of 1P.

4) Blinkit

BofA estimates quick trading GOV at Rs 14,590 crore, likely to rise 24% QoQ.

Morgan Stanley expects a stronger increase of 30.5% quarter-on-quarter and 143.7% year-on-year in November, with revenues rising to Rs74.4 billion as the mix shifts to the 1P model. Losses are likely to decline to Rs 0.7 billion from Rs 1.6 billion in the first quarter.

Nuvama predicts Blinkit’s GOV growth to be 23% quarter-over-quarter and 137.1% annualized, calling it the largest contributor to Eternal’s revenue growth.

However, Bonanza warned that intense competitive activity could slow profitability in the segment despite rapid expansion.

5) Warnings

Despite the solid revenue momentum, brokers expressed concerns about the sustainability of such high growth given the increasing intensity of competition from players like Zepto and JioMart.

“This suggests that growth is still driven by high spend and customer acquisition rather than sustainable profitability. Competition in the fast commerce space has intensified as Amazon, Reliance JioMart and Zepto expand aggressively, prolonging the market capture phase and delaying margin recovery. Meanwhile, the Food Delivery segment is showing signs of maturity, with slower user additions and weaker discretionary spending,” said Abhinav. Tiwari, research analyst at Bonanza, says.

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Profitability and cost discipline remain key concerns as the outlook remains cautiously positive depending on how quickly the company can turn its Quick Commerce business profitable, Tiwari said in a note.

(Disclaimer: The recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times.)