Eternal Ltd [NSE: ETERNAL], the parent company of Zomato, has reported its Q1 FY26 results, showcasing a dramatic decline in net profit, which fell by 90% YoY to ₹25 crore, compared to ₹253 crore in Q1 FY25. Eternal Ltd’s revenue from operations experienced a substantial increase of 70% YoY, reaching ₹7,167 crore, up from ₹4,206 crore in the previous year’s quarter. The performance gap between profit and revenue highlights a significant rise in the company’s expenses, which played a pivotal role in the profit decline.
On 21 July 2025, Eternal Ltd unveiled its Q1 results, showing substantial year-on-year growth in revenue, but profitability was sharply impacted due to the firm’s expanded expenses linked to its business investments, particularly in the quick-commerce segment.
Key Financial Highlights for Q1 FY26
- The company posted ₹7,167 crore in revenue, showing a 70% growth compared to ₹4,206 crore in the same quarter of the previous year.
- Net profit was recorded at ₹25 crore, showing a 90% decline compared to ₹253 crore in Q1 FY25.
- Total expenses surged to ₹7,433 crore, marking a 77% YoY increase from ₹4,203 crore in Q1 FY25.
While revenue grew significantly, it was offset by an increase in expenses, which surged by 77% YoY, amounting to ₹7,433 crore for the quarter. This is a 22% rise compared to ₹6,104 crore in the previous quarter, reflecting an aggressive investment in the company’s operations, including its quick-commerce expansion.
Quick-Commerce Expansion and Strategic Investments
Akshant Goyal, CFO of Eternal, attributed the profit decline to the ongoing investments in expanding the quick-commerce business. The company added 243 new quick-commerce stores during the quarter, leading to an impressive 127% YoY increase in Net Order Value (NOV), reaching ₹9,203 crore. This figure surpassed the food delivery NOV, which showed a 13% YoY growth, reaching ₹8,967 crore.
The company’s strategy of focusing on quick-commerce growth has reshaped its business, which reflects a fundamental shift in priorities. The investment in quick-commerce stores and related initiatives contributed to the increased operational costs but is expected to yield long-term growth and market share.
Outlook on Food Delivery and NOV Growth
Despite the growth in quick commerce, the company faced challenges in food delivery, with the YoY growth in food delivery Net Order Value (NOV) showing signs of slowing down. Deepinder Goyal, CEO of Eternal, acknowledged the slowdown in demand that started in late 2024, and indicated that growth in food delivery NOV is expected to stabilise shortly. However, he projected that the company would see over 15% growth in NOV for FY26, aiming for 20% growth in FY27.
The outlook for the food delivery segment remains cautiously optimistic, with expectations of recovery as market conditions stabilise.
Stock Performance and Market Sentiment
On 21 July 2025, shares of Eternal Ltd closed at ₹271.20 per share on the BSE, reflecting investor optimism in the company’s ongoing growth strategy despite the challenges in profitability.
Conclusion
Eternal Ltd’s Q1 FY26 results reflect a solid revenue growth despite a sharp decline in profitability, which was primarily due to the company’s continued investment in the quick-commerce segment. While the quick-commerce expansion has contributed to higher operational costs, it also shows potential for long-term growth, particularly with the strong increase in NOV.
As the company focuses on scaling its quick-commerce business and navigating the challenges in food delivery, Eternal Ltd is expected to continue its growth trajectory, with future improvements in profitability as investments mature and market conditions stabilise.
