Q1 financial results of Eternal (Zomato / Blinkit group)
Key Financial Highlights (Q1)
- Overall Performance: Revenues across major segments were largely in line with street estimates, though there was a mild miss on the bottom-line / operating margin front.
- Food Delivery Business:
- Adjusted Revenue: Came in at ₹3,537 crore (up 33% YoY and ~13% QoQ).
- Profitability: PBT (Profit Before Tax) from food delivery reached ₹621 crore (up from ₹549 crore sequentially).
- Margins: Adjusted EBITDA margin stood at ~5.6% – 6% of GOV (Gross Order Value).
- Quick Commerce (Blinkit):
- Revenue: Reported at ₹15,664 crore (against expectations of ~₹15,700 crore)
- GOV / NOV: Net Order Value (NOV) reached ₹17,132 crore.
- Margins / EBITDA: Adjusted EBITDA was ₹264 crore (~0.6% of GOV), which came in slightly softer than market expectations.
- Going Out & Hyperpure:
- Going Out: Delivered ₹318 crore vs. ₹297 crore estimated.
- Hyperpure: Saw a solid 6% sequential growth.
- Cash Position:
- Overall adjusted EBITDA rose to ₹555 crore (up from ₹429 crore).
- Closing cash balance remains strong at around ₹18,000 crore.
Why Did Margins Miss in Quick Commerce?
- Dark Store Expansion & CapEx: Eternal is aggressively expanding dark store footprints, scaling deeper into Tier-2 and Tier-3 cities.
- Growth vs. Margin Trade-off: Capital expenditure and setup costs for new dark stores temporarily suppressed short-term margins despite strong revenue growth.
- Gold Membership & Delivery Fee Adjustments: Fee reductions in loyalty programs (e.g., Gold membership) and changes in delivery pricing impacted top-line realizations.
Expert Comment
- Long-Term Outlook: Remains positive on Eternal.
- Key Takeaway: The softness in quick commerce margins is not a major structural concern. As newly opened dark stores mature over the next 2 to 3 quarters, incremental revenue and margin expansion should follow.