As Eternal, the parent company of Zomato, prepares to announce its first-quarter earnings on July 21, investors and analysts are bracing for a substantial Year-on-Year (YoY) profit decline. With several brokerages predicting a potential fall of up to 70% in profit after tax (PAT), the stage is set for a critical evaluation of the company’s fiscal health.

Key Predictions from Leading Brokerages

Four top brokerage firms have projected Eternal’s Q1 Fiscal Year 2026 (FY26) earnings, presenting a bleak picture with anticipated reductions driven mainly by challenges in their Blinkit segment and enhanced costs within their Going Out business. According to The Economic Times, the expected PAT numbers are concerning:

  • Nuvama Institutional Equities suggests a reduction to Rs 74.3 crore, a 71% YoY drop but with a quarterly rise of 90%.
  • JM Financial estimates a PAT of Rs 78 crore, marking a 69% YoY decrease.
  • ICICI Securities offers a conservative outlook with PAT at Rs 28 crore, down 89% YoY.
  • Kotak Institutional Equities predicts Rs 31 crore, signifying an 88% YoY downturn.

Surging Revenue Amidst Profit Decline

Despite the expected dip in profits, Eternal might witness robust revenue growth, propelled by expanding ventures like Blinkit and Hyperpure. Analysts anticipate a revved-up revenue momentum:

  • Nuvama forecasts a 57% YoY increase to Rs 6,596 crore.
  • JM Financial projects similar figures at Rs 6,617 crore.
  • ICICI Securities is more bullish, with an expected Rs 7,081 crore, marking a 14% QoQ surge.
  • Kotak Equities estimates Rs 6,682 crore, showcasing a healthy 59% YoY rise.

Adjusting EBITDA Expectations

Eternal’s EBITDA outlook reflects both sequential uplift and YoY pressures, faced with operational challenges, particularly within Blinkit:

  • A notable sequential EBITDA improvement is anticipated, yet YoY remains under stress, with Nuvama and JM projecting Rs 165 crore and Rs 168 crore respectively.

Monitoring Key Metrics

As Eternal navigates through complex fiscal terrain, critical metrics must be monitored, including Blinkit’s revenue and margin contributions, food delivery cost structures, effectiveness of growth strategies, and management’s direction on store expansion and profitability pathways.

Stay tuned as this financial chapter of Eternal unfolds, setting a precedent for its strategic revisions and operational excellence against fluctuating economic backdrops.