Should you buy Zomato shares after Q4 miss and Blinkit drag? Here’s what top brokerages say

Shares of Eternal Ltd (formerly Zomato) are back in focus after the company posted a 77.71 per cent year-on-year drop in consolidated net profit for the March 2025 quarter. While revenue grew to Rs 5,830 crore, in line with estimates, the operating performance fell short of Street expectations.

EBITDA margin slipped 180 basis points sequentially to 1.2 per cent, below the estimated 1.7 per cent. PAT stood at Rs 39 crore, nearly matching analyst forecast of Rs 42.10 crore.

Brokerage verdict

Brokerages remain divided on Eternal’s outlook, particularly amid rising competitive intensity in the quick commerce (Q/C) space and underperformance at Blinkit due to ongoing expansion.

Blinkit: Still expanding, but yet to reach profitability sweet spot

Blinkit has added 40 per cent of its current 1,301 stores over the last two quarters. These newly launched stores remain underutilised and sit at the bottom of the profitability curve, according to Nuvama. However, contribution margins improved to 3.1 per cent in Q4, while adjusted EBITDA margins fell to -1.9 per cent due to higher marketing spends.

Nuvama on Eternal

The brokerage maintained a ‘Buy’ call with a revised target of Rs 290 (earlier Rs 300), citing lower-than-expected Blinkit losses. It expects adjusted EBITDA losses to start narrowing from Q1FY26, assuming the store expansion cycle peaks out.

JM Financial view

The brokerage remains bullish for long-term investors, recommending buying into dips. It forecasts a slowdown in Blinkit’s expansion from Q2FY26 and expects losses to peak in Q1FY26, aiding operational leverage.

Jefferies flags caution

Despite a decent Q4 print, Jefferies maintained a ‘Hold’ rating, trimming its target to Rs 250. It highlighted cautious management commentary and slashed adjusted EBITDA estimates by 5–15 per cent, citing rising threats from players like Amazon and Flipkart.

Citi, Nomura stay bullish

Citi raised its target price to Rs 290 from Rs 280 and retained its ‘Buy’ rating. Nomura echoed this stance with a Rs 280 target, noting that Eternal is not burning cash at EBITDA level and remains well positioned despite the Q/C drag.

Macquarie 

Macquarie continues to see downside risk and kept its ‘Underperform’ rating with a low target of Rs 150.

Morgan Stanley 

Morgan Stanley maintained its ‘Overweight’ stance and set a price target of Rs 330, among the highest on the Street.

Key metrics from Q4FY25:

• Revenue: Rs 5,830 crore (vs estimate of Rs 5,820 crore)

• EBITDA Margin: 1.2% (vs 1.7% expected)

• PAT: Rs 39 crore (vs Rs 42.1 crore estimate)

• Food Delivery Contribution Margin: 8.6% (Q3: 8.5%)

• Blinkit EBITDA Margin: -1.9% (down 60 bps QoQ)

While near-term pressures persist due to Blinkit’s aggressive scaling and Q/C rivalry, long-term broker sentiment remains divided. Traders should watch for signs of operating leverage from Q1FY26 onward. For now, Eternal remains a stock to track closely especially if competition in quick commerce intensifies.