Motilal Oswal Sees 34% Upside in Eternal: Blinkit, Food Delivery & District Drive $1 Billion EBITDA Vision

Synopsis : Motilal Oswal has reiterated its 'Buy' rating on Eternal (formerly Zomato) with a target price of ₹380, citing strong growth across food delivery, Blinkit and District. The brokerage believes these three businesses could help the company achieve its ambitious $1 billion adjusted EBITDA target by FY29.

Motilal Oswal Financial Services has reaffirmed its 'Buy' recommendation on Eternal (formerly Zomato) with a target price of ₹380, implying an upside potential of around 34% from current levels.

The brokerage believes the recent correction offers an attractive long-term investment opportunity, supported by three major growth drivers that could significantly improve the company's earnings over the next few years.

Food delivery business regains momentum

Motilal Oswal noted that Eternal's core food delivery business has delivered improving growth for three consecutive quarters.

The recovery has been driven by initiatives focused on value-conscious consumers, including additional benefits for Gold members and affordable meal offerings priced below ₹250.

The brokerage expects the food delivery segment to remain a stable duopoly in India and forecasts medium-term annual growth of around 18-20%.

Blinkit remains the biggest growth opportunity

Quick commerce platform Blinkit continues to strengthen its market position despite rising competition from players such as Zepto.

According to Motilal Oswal, Blinkit has already achieved adjusted EBITDA breakeven and its mature markets, including Delhi-NCR, are generating EBITDA margins of around 5-6%.

The company also operates the industry's largest dark-store network and aims to expand it to 3,000 stores by March 2027, reinforcing its leadership position.

District could become the next growth engine

The brokerage also highlighted District, Eternal's emerging "going-out" business, as a promising long-term opportunity.

District is targeting India's rapidly expanding live events and concert ecosystem, which Motilal Oswal expects to grow 2-2.5 times over the next five years.

If execution remains strong, the brokerage estimates District could contribute nearly $125 million in EBITDA by FY30.

India's live events industry is already estimated at ₹20,000-22,000 crore, with concerts growing at 18-20% annually, while ticket sales account for nearly 50-60% of event revenues.

Company targets $1 billion EBITDA by FY29

Eternal has set an ambitious goal of generating $1 billion in adjusted EBITDA by FY29.

Motilal Oswal expects nearly $500 million to come from Blinkit's quick commerce business, around $425 million from food delivery, while businesses such as District and Hyperpure are expected to contribute the remaining amount.

Strong stock performance

Eternal's shares have gained approximately 6.5% over the past five trading sessions.

The stock is up 16.4% over the last month, has delivered around 12% returns over the past year and has gained 2.4% during the last six months.

Q4 FY26 highlights

The company reported a sharp improvement in profitability during the fourth quarter of FY26.

Net profit jumped 346% year-on-year to ₹174 crore, compared with ₹39 crore in the corresponding quarter last year.

Revenue from operations surged 196% to ₹17,292 crore, driven by continued expansion across food delivery and quick commerce businesses.

For the full FY26 financial year, Eternal reported a net profit of ₹366 crore, slightly higher than ₹351 crore recorded in FY25.

Conclusion

Motilal Oswal believes Eternal's long-term growth story is no longer dependent solely on food delivery. With Blinkit scaling rapidly, District emerging as a new growth platform and the core delivery business maintaining healthy momentum, the brokerage expects the company to steadily progress toward its $1 billion EBITDA target, supporting its positive outlook on the stock.

Disclaimer : This article is for informational and educational purposes only. The views, ratings, target prices and financial estimates mentioned are those of Motilal Oswal Financial Services and do not constitute investment advice or a recommendation to buy, sell or hold any security. Stock market investments are subject to market risks. Investors should conduct their own research and consult a SEBI-registered investment advisor before making any investment decisions.