Profitability Concerns Bite: HSBC Reduces Eternal’s Target Price

Global brokerage HSBC has trimmed its target price for Eternal Ltd (ETEA.NS) to ₹350 from ₹390, underscoring the mounting challenges in India’s fast-growing quick commerce industry. Despite strong momentum in food delivery, Eternal’s quick commerce vertical continues to face margin pressures due to aggressive competition.

Key Highlights
Target revision: HSBC’s downgrade reflects concerns over profitability in Eternal’s quick commerce operations.

Competitive intensity: Rival platforms like Blinkit and Swiggy are pushing aggressive expansion, squeezing margins across the sector.

Food delivery resilience: Eternal’s core food delivery business remains robust, with steady growth in gross order value (GOV).

Investor sentiment: Shares of Eternal have shown short-term gains, but analysts warn that sustained competition could weigh on long-term valuations.

Industry outlook: HSBC expects consensus food growth to moderate to 12–15%, keeping profitability timelines under scrutiny.

This recalibration highlights the balancing act between growth and profitability in India’s digital commerce ecosystem. Eternal’s ability to innovate and streamline costs will be crucial in maintaining investor confidence amid sector-wide headwinds.

Sources: CNBCTV18, Investing.com India, Trendlyne