Eternal Q1FY27: Blinkit turns profitable as scale builds across NOV, stores and cash

Eternal Limited (formerly Zomato Limited) entered FY27 with a quarter that reinforced two parallel narratives: the core food delivery business is now consistently profitable at the upper end of its stated steady-state margin range, and Blinkit’s quick commerce model is scaling rapidly while crossing into positive Adjusted EBITDA.

For the quarter ended June 30, 2026 (Q1FY27), the company reported consolidated B2C NOV of INR 31,120 crore, up 54% year on year. Consolidated Adjusted Revenue rose to INR 20,648 crore, up 173% year on year, with management noting that the sharp growth is heavily influenced by the shift in quick commerce to a 1P inventory model where reported revenue includes the full value of goods sold. Consolidated Adjusted EBITDA increased to INR 555 crore, up 223% year on year.

The underlying composition of growth matters. Food delivery continues to grow steadily while contributing the bulk of profits. Blinkit is now the largest consumer business by NOV and is improving profitability with each quarter. District (going-out) is growing fast but remains loss-making. Hyperpure has returned to a small profit at the Adjusted EBITDA level. New initiatives in “Others” are absorbing higher investment.

Consolidated snapshot and segment mix

Eternal’s disclosed segment information provides a clear view of how revenue and profitability are distributed across the portfolio.

On an Adjusted Revenue basis for Q1FY27, quick commerce is the dominant contributor.

Food delivery: growth with steady-state margins in sight

Food delivery (Zomato) delivered NOV of INR 10,769 crore in Q1FY27, up 20.1% year on year. Adjusted Revenue was INR 3,537 crore, up 33.1% year on year. Adjusted EBITDA rose to INR 606 crore, translating into an Adjusted EBITDA margin of 5.6% of NOV.

In the shareholder letter, management addressed a key investor concern directly: as margins approach the top end of the 5 to 6% steady-state guidance and NOV growth accelerates, would the business need to trade margin for growth. The response was unambiguous. Management framed this as a flywheel where product improvements increase frequency, density and efficiency, allowing growth and margins to compound together. It added that if a future trade-off is required to expand the market, it would prioritise long-term growth.

Operationally, food delivery average monthly transacting customers increased to 27.2 million in Q1FY27 from 25.4 million in Q4FY26, while average monthly active delivery partners rose to 638,000.

Blinkit: profitable quarter and a sharper ROCE lens

Quick commerce (Blinkit) remains the main growth driver. NOV reached INR 17,132 crore, up 86.2% year on year and 19.1% quarter on quarter. Adjusted Revenue was INR 15,664 crore, up 552.7% year on year due to the accounting impact of the 1P inventory-led model.

Profitability improved further. Blinkit reported Adjusted EBITDA of INR 102 crore, or 0.6% of NOV, versus a loss of INR 162 crore in Q1FY26. The business added 200 net new stores in the quarter, taking store count to 2,443.

Two disclosures stood out.

First, management emphasised that quick commerce is inherently capital intensive. It cited around 19 million sq ft of store and warehousing space across 300 plus cities and cumulative capex of about INR 3,000 crore over the past four years. It also disclosed net working capital of INR 2,545 crore at the end of Q1FY27, or about 14 days of annualised NOV.

Second, the company updated its steady-state ROCE framework after completing a full year as a 1P business. The revised assumptions were: capex per store including warehousing of INR 2.5 crore (up from INR 1 crore previously), net working capital of 12 days of NOV (3.3%), NOV per day per store of INR 11 lakh, and an EBIT margin of 4% of NOV, driven by a 6% Adjusted EBITDA margin.

Using these assumptions, the company illustrated a pre-tax ROCE of 41.7% (4 divided by 9.6). Management also clarified on the call that it is referring to GAAP EBIT, including ESOP and depreciation, when it speaks of an EBIT margin.

Inventory risk is an unavoidable part of 1P models. Eternal quantified its inventory losses at about 1.8% of NOV, driven largely by perishables, and said these losses are part of COGS and therefore already netted off in gross profit.

On competition, management said Q1 was the peak of competitive intensity seen so far, primarily driven by subsidies on products and delivery fees. At the same time, it described competition as more predictable because deeper discounting would increase losses sharply for peers. Blinkit’s approach continues to centre on infrastructure-led growth, with management arguing that capacity expansion creates operating leverage over time.

The most detailed competitive scorecard provided was retention. The company shared cohort metrics for quick commerce, including average Q4 retention of 46% across cohorts and 50% for the most recent cohort, as well as NOV retention that increased to 279% by Q12 on average.

District, Hyperpure and Others: growth, recovery and experimentation costs

District (going-out) delivered NOV of INR 3,218 crore, up 59.8% year on year. However, profitability remains a work in progress. Adjusted EBITDA was negative INR 65 crore, or minus 2.0% of NOV. Management noted that the growth acceleration is not simply seasonal, while cautioning that the business is inherently lumpy due to movie release calendars and event seasonality. On the call, it also noted that the going-out customer base is smaller than food delivery or quick commerce and is likely to be present in fewer cities.

Hyperpure (B2B supplies) reported Adjusted Revenue of INR 1,034 crore. Management highlighted like-for-like growth of 27% year on year and 6% quarter on quarter, with Adjusted EBITDA turning positive at INR 6 crore.

The “Others” segment, which includes new initiatives such as Bistro, Nugget and Greening India, reported Adjusted Revenue of INR 95 crore in Q1FY27. Adjusted EBITDA loss widened to INR 94 crore from INR 45 crore in Q1FY26, with management attributing the increase largely to R and D investments in Nugget as it scales AI product capabilities. In the concall, management described Nugget as an enterprise AI product business and said it remains in a more stealth mode.

Cash, capex and disclosures to watch

Eternal reported closing cash balance of INR 18,288 crore, up INR 316 crore quarter on quarter, in its cash bridge table. It also disclosed Q1FY27 capital expenditure incurred of INR 711 crore. Management explained that capex can be lumpy because warehousing investments are not evenly distributed by quarter, even though it presents a capex per store framework.

Investors should also note disclosed regulatory exposure. In the consolidated notes, the company listed GST orders and show cause notices related to GST on delivery charges collected on behalf of delivery partners. The amounts disclosed include INR 420 crore for October 2019 to March 2022 and INR 414 crore for April 2022 to March 2024 across states, among other items. The auditor drew attention to this matter while not modifying its conclusion.

Takeaways from Q1FY27

Eternal’s Q1FY27 performance suggests a portfolio where the profit engine is food delivery, the growth engine is Blinkit, and the optionality comes from District and newer initiatives. The quarter also showed stronger disclosure depth in quick commerce, with updated ROCE assumptions, quantified inventory losses, and customer retention data.

The next few quarters will likely hinge on whether Blinkit can sustain growth while expanding store footprint and capital employed, and whether District can keep scaling without losses widening. For now, the company has shown that growth and profitability can coexist at the consolidated level, even while it continues to fund experimentation through the Others segment.