Eternal Q4 results: Higher losses at Blinkit to hit bottom line, 60% sales growth likely

Eternal Q4 earnings: Higher losses at Blinkit due to new store additions may hurt Eternal's (erstwhile Zomato) March quarter results, with brokerages largely expecting nil profit or losses for the online food delivery platform. Analysts see Eternal reporting 59-66 per cent YoY growth in sales, led by a spurt rise in quick commerce revenues. 

JM Financial sees profit at Rs 70 lakh for Eternal, down 99.6 per cent YoY over Rs 175.30 crore in the same quarter last year. It sees total revenue coming in at Rs 5,721 crore, up 60.60 per cent YoY. Ebitda is seen falling 27.8 per cent YoY to Rs 62.30 crore and Ebitda margin is expected to contract 133 basis points to 1.1 per cent. 

Nuvama expects Eternal (Zomato) to report 66.2 per cent YoY growth in revenue, led by 15.7 per cent growth in adjusted revenue for the Food delivery segment and 123.8 per cent YoY surge in growth for the quick commerce (Blinkit). This brokerage estimated the Food delivery adjusted Ebitda at Rs 450 crore while it sees Blinkit's adjusted Ebitda loss at Rs 236 crore. Consolidated Ebitda margin is seen contracting 190 basis points sequentially due to Blinkit losses. Overall, the brokerage sees losses at Rs 36.10 crore on sales of Rs 5,921.30 crore.

JM Financial forecast a 2 per cent sequential fall in gross order value (GOV) due to seasonality (fewer days in February). The YoY growth pegged at 14.7 per cent would be slower than  recent quarters on account of broader consumption slowdown, JM Financial said.

Ordering frequency and AOV in the food delivery segment is seen declining 2 per cent each and take-rates are likely to expand to 21.3 per cent in 4QFY25, as it will be the first full quarter where platform fees were Rs 10 per order. The contribution margin (as percentage of GOV) is seen expanding to 8.8 per cent from 8.5 per cent in Q3. 

"In Blinkit, we expect sequential GOV growth of 17 per cent led by  robust increase of 20% in order volumes (that in turn should be driven by MTU increase  from 12.9mn to 10.6mn). However, take-rates may come down a bit to 17.7 per cent from 17.9 per cent in 3Q due to increasing share of low-margin products in product mix and lower  delivery fees (amidst high competitive pressures in newer geos). We see contribution  margin contracting to 2 per cent," JM said. 

Kotak Institutional Equities sees Ebitda loss of Rs 250 crore for the Blinkit business, as new store addition are seen offseting higher profitability of older stores. This brokerage sees adjusted profit falling 83 per cent YoY to Rs 29.70 crore.