Eternal Q1 FY27 Results (NSE: ETERNAL)
Signal: Margin pressure
The read
Consolidated PAT of ₹92 Cr was driven by other income (138% of PBT) and a low effective tax rate; core operations generated EBIT of ₹423 Cr (+173% YoY) but EBITDA margin contracted 175bps YoY to 4.8% as the mix shifted to lower-margin quick commerce revenue. Quick commerce turned profitable for the first time (segment profit ₹365 Cr) while India food delivery continued to scale profitably.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹20,211 Cr | 182.0% | -62.8% |
| EBIT | ₹423 Cr | 172.9% | |
| Net profit | ₹92 Cr | 268.0% | |
| EPS | ₹0.1 | 233.3% | |
| EBIT margin | 4.8% |
P&L walk
Revenue growth was driven by the inventory-led quick commerce transition (segment revenue up 553% to ₹15,664 Cr), but gross margin collapsed 26.9pp to 40.5% due to the same mix shift. EBITDA margin contracted 175bps YoY to 4.8% as the lower-margin quick commerce revenue dominated. Operating profit (EBIT) grew 173% to ₹423 Cr, but PAT of ₹92 Cr was disproportionately aided by other income (₹375 Cr, 138% of PBT). Tax expense jumped to ₹180 Cr from ₹63 Cr QoQ, compressing sequential profit.
Segments
Quick commerce achieved segment profit of ₹365 Cr vs loss of ₹42 Cr a year ago, driving the consolidated improvement; India food ordering profit grew 33.5% to ₹621 Cr; Hyperpure revenue declined 55% due to model change but remained profitable; Going out and other segments incurred losses.
Key positives
- Quick commerce segment turned profitable with ₹365 Cr segment profit vs loss of ₹42 Cr a year ago.
- India food ordering segment profit grew 33.5% YoY to ₹621 Cr.
- Revenue grew 182% YoY to ₹20,211 Cr.
- EBITDA increased 106.6% YoY to ₹969 Cr.
Key concerns
- EBITDA margin contracted 175bps YoY due to mix shift to quick commerce.
- PAT entirely dependent on other income (137.9% of PBT); core operating profit still modest.
- GST contingency of ₹420 Cr disputed by company but unresolved.
- EPS growth (233%) lags PAT growth (268%) due to dilution and rounding.
Earnings quality: includes non-operating other income
Research and educational content only. Not investment advice.