Eternal Limited (formerly Zomato) held its Q3FY26 earnings conference call on January 21, 2026. Key discussion points included quick commerce breakeven, competitive intensity, growth strategies, and margin outlook. Management expressed confidence in long-term margin expansion but noted short-term volatility. The company is focusing on market share gains and assortment expansion. District Pass membership program has been launched. Expansion plans and profitability targets were also addressed during the call.
Quick Commerce Performance
Eternal Limited achieved breakeven in its quick commerce business (Blinkit). The company’s contribution margin expanded by 90 basis points, and EBITDA increased by approximately 130 basis points despite store throughput decreasing by around 6% QoQ. The competitive intensity is expected to keep margins volatile in the near term. Margins are projected to expand in the long term, with confidence in achieving 5% to 6% Adjusted EBITDA margin.
Growth Strategy
Eternal Limited aims for 100% YoY growth. This growth is contingent on competitive dynamics. The company plans to open 3,500 to 4,000 stores if the competition remains rational. A large portion of future growth is expected to come from market share gains. In the going-out business, the company is focusing on sub-segments such as events and movies.
District Pass Program
The company launched the District Pass membership program. This initiative contributed to increased losses in the short term but is expected to drive multi-category usage on the app. Losses from the going-out business are anticipated to decrease sequentially in the next four to six quarters, moving towards breakeven.
Store Expansion and Throughput
Store throughput decreased due to assortment expansion. The addition of new stores is geared towards expanding the product range. The company believes that NOV per day per store will continue to grow over time. There are no plans to exit any of the cities in which the company currently operates. Net store additions for the quarter were 211.
Margin Outlook and Key Factors
Management refrained from providing specific margin guidance for the next quarter due to unpredictable competitive intensity. Expansion of assortment has led to a reduction in turn over. The company is aiming for ROCE (Return on Capital Employed) north of 40%.
Impact of GST Changes
GST cuts brought down basket pricing by 3%, which was expected to help in higher demand. However, supply challenges impacted the benefits. The full benefits from increase in inventory are expected to accrue in the next six to nine months
Leadership and Operational Structure
Albinder Singh Dhindsa continues to lead the Blinkit business. There will be no changes in operational structure. Deepinder Goyal remains involved and committed to building Eternal.
Source: BSE
