Why Is Eternal Gaining Investor Confidence After Blinkit Turns EBITDA Positive?
About Eternal’s Q3 Performance
Eternal’s December quarter marked an important inflection point, with the company delivering a positive surprise on margins and asset quality while its quick-commerce arm, Blinkit, reported EBITDA profitability. The quarter reinforced management’s execution capabilities across both the core lending platform and the fast-scaling commerce business.
The results suggest that Eternal is transitioning from a phase of aggressive investment to one where operating leverage and discipline are beginning to show through in consolidated numbers.
Key Highlights From the Quarter
🔹 Core profits grew 29% YoY, excluding the impact of new labour law adjustments
🔹 Asset quality improved, supporting lower credit costs
🔹 Blinkit achieved EBITDA breakeven despite peak competitive intensity
🔹 Higher margins were driven by better mix and operating efficiencies
A notable aspect of the quarter was Blinkit’s profitability milestone, which came even as competition in the quick-commerce space remained intense. This indicates that earlier investments in infrastructure, supply chain, and technology are now yielding tangible financial benefits.
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What Drove Margin Improvement?
| Driver | Impact on Profitability |
|---|---|
| Higher AOV | Improved unit economics at Blinkit |
| Business mix | Shift towards higher-margin segments |
| Cost discipline | Lower credit costs and better operating leverage |
| Scale benefits | Past investments beginning to pay off |
The combination of improving asset quality in the lending book and better unit economics in Blinkit has strengthened Eternal’s overall earnings profile, reducing concerns around prolonged cash burn.
|
Strengths Emerging
🔹 Improving asset quality trends 🔹 Blinkit EBITDA profitability milestone 🔹 Strong AUM growth momentum |
Risks to Monitor
🔻 Competitive intensity in quick commerce 🔻 Expense discipline as scale expands 🔻 Macroeconomic impact on discretionary demand |
Outlook and Brokerage View
Brokerage commentary remains constructive, citing strong core profitability, improving asset quality, and Blinkit’s EBITDA breakeven as key positives. As unsecured loan momentum improves and operational efficiencies deepen, earnings visibility is expected to strengthen further.
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Investor Takeaway
Derivative Pro & Nifty Expert Gulshan Khera, CFP®, believes Eternal’s Q3 performance reflects a meaningful shift from investment-heavy growth to profitability-led scaling. Blinkit’s EBITDA breakeven, combined with improving asset quality, enhances confidence in the company’s medium-term earnings trajectory. Investors should continue to focus on execution consistency and cost discipline as the business scales further. Deeper market perspectives are available at Indian-Share-Tips.com, which is a SEBI Registered Advisory Services.
Related Queries on Eternal and Blinkit
Why is Blinkit’s EBITDA breakeven significant?
Can Eternal sustain margin improvement?
How does asset quality impact Eternal’s profitability?
What are the risks in quick-commerce competition?
Is Eternal entering a profitability-led growth phase?
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
