Eternal Limited ended Q4 FY26 on a strong note, at least on paper. The company reported consolidated adjusted revenue of Rs 17,680 crore, while B2C net order value grew 54% year-on-year.
Its cash balance also remained at Rs 18,000 crore. But beyond these headline numbers, two key businesses, Blinkit and District, reveal a more nuanced picture.
Blinkit continues to scale rapidly. Its net order value stood at Rs 14,386 crore in Q4FY26, which indicates the growing demand for quick commerce. However, the profitability remains thin. Despite operating 2,243 dark stores, with 17 million square feet of space, and deploying over 4 lakh delivery partners, the business reported an adjusted EBITDA of just Rs 37 crore. This decodes to a margin of around 0.3% of net order value.
The company has indicated that mature markets such as Delhi NCR are moving towards a steady-state margin of 5-6%, which suggests the model can work. However, scaling this across the country is not straightforward. As per the company, the top eight cities are already largely covered with 80-90% of serviceable pin codes, leaving limited room for easy expansion.
Now, growth from here will come from smaller cities, where online grocery adoption is still low and the customers who have never ordered groceries online, where each new market will require fresh investments and time to stabilise, which could weigh on overall margins in the near term.
According to the shareholders' letter, the average monthly transacting customers grew from 13.7 million in Q4 FY25 to 27.2 million in Q4 FY26, while the net average order value remains flat at Rs 525, which shows that volume growth is coming from more smaller and frequent orders rather than high-value baskets.
We have also noticed that, during FY26, the firm spent around Rs 1,700 crore as capital expenditure into Blinkit from its free cash flow (almost Rs 450 crore in every quarter), which is generating Rs 37 crore adjusted EBITDA in a quarter.
Eternal's going-out platform, District, also presents a different challenge. The segment recorded Rs 277 crore in revenue on a net order value of Rs 2,736 crore in Q4 FY26, while posting an adjusted EBITDA loss of Rs 81 crore. Although losses have reduced from Rs 121 crore in the previous quarter, the improvement remains modest given the relatively small revenue base.
The business operates in a highly competitive space where incumbents already have strong supplier networks and user engagement. At the same time, demand is closely tied to external factors such as movie releases, live events, and overall discretionary spending, all of which can fluctuate.
Eternal, therefore, is building two distinct bets. Blinkit has demonstrated scale but has yet to deliver meaningful profitability beyond its most mature markets. District, on the other hand, is still in the early stages of finding both scale and stability. The oldest business, food delivery, continues to deliver numbers without the much awaited bottomline.
That places Eternal in a very piquant situation. No cash cows worth the name to milk. Strong cash reserves mean no immediate challenge, but building up to sustainable profitability is still not as close as the firm would have shareholders believe. Stagnating net order values indicate the pressure from peers for Blinkit, even as District, with its significant opportunity for higher margins on paper, also has a strong, and scrappy incumbent in BookMyShow to contend with. But it remains the business with higher potential to surprise on the upside. The question is, will the market have the patience to wait out the volatility along the way. Looking at the exceptional effort to show some sort of profits in Blinkit, it would seem the firm is aware of the risks with a high cash burning strategy.