Geojit Investments has reiterated a BUY recommendation on Eternal Ltd., formerly Zomato Ltd., with a revised target price of Rs 283, implying roughly 19% upside from the current market price of Rs 238. The brokerage’s thesis rests on a sharp scale-up in quick commerce, steady improvement in food delivery, and the company’s expanding operational footprint across geographies. Even after trimming estimates on macro caution, Geojit argues the stock still offers a credible medium-term re-rating case. The note frames Eternal as a growth-led consumer internet play that is pushing toward profitability with improving operating leverage and stronger demand density.

What Drove FY26

Eternal delivered a striking topline surge in FY26, with consolidated revenue rising about 169% year on year to Rs 54,364 crore. Much of that leap came from the transition to an inventory-led first-party model in quick commerce, which mechanically lifted reported sales, though underlying momentum remained robust even after stripping out accounting effects. Quick commerce revenue jumped to Rs 37,779 crore from Rs 5,206 crore in FY25, while food delivery revenue rose 25.7% to Rs 10,159 crore on better net order value, stronger order frequency, and improved traction among budget customers.

Operational Pulse

The company’s B2C net order value climbed to Rs 95,959 crore, supported by dark-store expansion, new user additions, and wider category adoption. In the quarter, revenue rose 196.5% year on year to Rs 17,292 crore, and adjusted EBITDA increased 575% to Rs 486 crore, showing that scale is now beginning to translate into operating leverage. Still, margin performance remains modest, with adjusted EBITDA margin at 2.2% for FY26 and PAT down 30.6% to Rs 366 crore, underscoring that Eternal is still in the investment-heavy phase of its growth story.

Management Commentary

The management sounded constructive on the business trajectory, saying larger cities such as Delhi-NCR are moving toward a 5% to 6% steady-state margin. It also expressed confidence in meeting the March target of 3,000 stores and a 60% compound annual growth rate in net order value, though no fresh store-addition guidance was offered. Another notable takeaway was that GST increases were absorbed by consumers with limited demand damage over the past 12 to 18 months, suggesting pricing resilience in the model.

Valuation Snapshot

Geojit’s sum-of-the-parts valuation pegs Eternal’s equity value at Rs 273,443 crore, or Rs 283 per share, after factoring in negative net debt of Rs 4,035 crore. The brokerage values food delivery at 22 times FY28 EBITDA, quick commerce at 1.0 times FY28 net order value, and the other businesses at sales-based multiples. That structure shows where the market’s real enthusiasm lies: quick commerce contributes the largest chunk of value at Rs 172 a share, while food delivery adds Rs 100 a share.

Targets And Levels

For investors tracking levels, Geojit’s stated CMP is Rs 238 and the revised target is Rs 283. That places the immediate upside zone in the Rs 270 to Rs 283 band, while near-term support can reasonably be watched around the recent 52-week low area of Rs 213 and the broader trading zone around Rs 230 to Rs 238. On the report’s own framework, the stock remains a BUY because the expected upside is above 10%, and the firm has not shifted away from its constructive stance despite moderating some growth assumptions.

Estimate Cuts

Geojit has trimmed its FY27 and FY28 forecasts, reflecting a more conservative macro stance and slower expected normalization in some parts of the business. Revenue for FY27 is now estimated at Rs 96,021 crore, versus the earlier Rs 93,589 crore, while FY28 revenue is projected at Rs 140,852 crore. Adjusted PAT for FY27 has been cut to Rs 1,771 crore from Rs 2,331 crore, and EPS to Rs 1.8 from Rs 2.4, implying that profitability is still scaling, but not as quickly as previously hoped.

Investor Takeaway

The broader investment case is straightforward: Eternal is evolving from a high-burn consumer platform into a larger, denser, and more monetizable ecosystem. Quick commerce remains the key engine, food delivery continues to mature, and the company is still adding stores and deepening engagement in non-metro markets. The caution is equally clear: competition is intense, margins are thin, and valuation remains demanding at 572.6 times FY26 earnings, even after the latest pullback.

In plain terms, Geojit sees a company with strong strategic momentum, but one that still needs to prove that scale can turn into durable earnings power. For long-term investors comfortable with volatility, the current setup offers an embedded growth option; for shorter-term traders, the Rs 238 to Rs 283 range is the key battleground.