Shares of India’s Eternal erased early gains on Thursday as concerns over the long-term profitability of its quick-commerce unit Blinkit amid intensifying competition outweighed strong results.
The stock lost as much as 2.6% and was down 0.8% as of 12:20 a.m. IST. It hit a high of 8% in premarket trading.
The company, formerly Zomato, reported a 73% rise in quarterly profit on Wednesday.
“While the results are good, there is fear whether it will be able to keep up with profitability,” said Rahul Jain from Dolat Capital.
Analysts said risks remain around Blinkit’s long-term profitability. Blinkit has become Eternal’s biggest revenue engine in recent quarters, fuelled by a boom in India’s $11.5 billion quick-commerce market, where rivals race to deliver everything from iPhones to milk in minutes.
Eternal said that growth could weigh on margins in the near-term. It also said founder Deepinder Goyal would step down as chief executive to be replaced by Blinkit head Albinder Dhindsa, while adding that the once cash-hungry unit had turned profitable.
“In the short term, we want to take the right decisions for the business, even if that means taking a hit to margins,” Eternal CFO Akshant Goyal said in a post-earnings call, but added that the company was not signalling such an impact in the very next quarter.
Blinkit leads India’s quick-commerce market with a 48% share, ahead of Swiggy’s SWIG.NS Instamart at 24% and Zepto KIRK.NS at 22%, data for 2025 from Datum Intelligence showed.
The market is projected to more than triple to about $40 billion by 2030, underscoring the high-stakes race for scale and dominance.
“The risk is that the market leader could be drawn into a dogfight too, with lower minimum order values and higher discounts,” Morgan Stanley said in a note.
Reuters
