Rs 7,200 crore buying! Eternal emerges as top MF Nifty pick; buy, hold or sell?
MF holding in Eternal has been rising steadily in the past couple of quarters. The institutional class held 21.6 per cent stake in Eternal in Q1, up from 19.4 per cent in Q4FY25.
- Sep 15, 2025,
- Updated Sep 15, 2025 10:33 AM IST
Eternal Ltd emerged as the top stock bet for mutual funds (MFs) in August, as the institutional class bought Rs 7,200 crore worth 22.9 crore additional shares in the online food delivery platform for the month. MFs owned 225.60 crore Eternal shares at the end of August against 202.70 crore shares in July, as per Nuvama. These shares are worth Rs 72,665 crore at Monday's intraday price of Rs 322.10 apiece.
MF holding in Eternal has been rising steadily in the past couple of quarters. The institutional class held 21.6 per cent stake in Eternal as of June 30, up from 19.4 per cent as of March 31, 16.5 per cent as of December 31, 2024, and 15.5 per cent as of September 30, 2024. The stock has rewarded investors, rising 59 per cent in the past six months. The stock gained, even as there are concerns over the heightening competition in the quick commerce space.
Recently, Amazon Now, the quick commerce (QCom) business of Amazon, expanded its operations to Mumbai, after Bengaluru and Delhi. While the footprint remains small compared to incumbents, 100 dark stores versus 1,544 for Blinkit and 1,062 for Swiggy, Amazon has the capital as well as the ambition to scale it up, anlaysts noted.
"However, we believe that incumbents are better placed – creating almost an entirely new supply chain for its QCom business will be a challenge for Amazon, given that incumbents have an advantage of being top-of-the mind recall apps for a large pool of customers. More competition is a feature of the land grab phase, in which adjacent players enter the market which drives market expansion and growth," Emkay said.
While excessive competition will weigh on profitability, Emkay said consumer stickiness to help incumbents retain customers. Once industry growth slows down, this brokerage sees a consolidation phase to follow, which will result in sub-scale players folding operations and driving profitability.
"Blinkit is executing well in the QCom space. We retain buy on Eternal with a target price of Rs 330," it said.
MOFSL noted that food delivery (FD) growth slowed due to weak consumption and macro pressures, while quick commerce (QC) profitability came under strain from heightened competition, accelerated dark store rollouts, and elevated customer acquisition costs.
"We now believe the cycle is turning," it said.
This brokerage has raised food delivery growth estimates to 21-23 per cent for FY26-FY27 (19-20 per cent earlier), value the business at 35 times FY27E Ebitda. It also tweaked its profitability assumptions for quick commerce for Blinkit. MOFSL suggested 'Buy' and a target of Rs 420 for Eternal.
Eternal Ltd emerged as the top stock bet for mutual funds (MFs) in August, as the institutional class bought Rs 7,200 crore worth 22.9 crore additional shares in the online food delivery platform for the month. MFs owned 225.60 crore Eternal shares at the end of August against 202.70 crore shares in July, as per Nuvama. These shares are worth Rs 72,665 crore at Monday's intraday price of Rs 322.10 apiece.
MF holding in Eternal has been rising steadily in the past couple of quarters. The institutional class held 21.6 per cent stake in Eternal as of June 30, up from 19.4 per cent as of March 31, 16.5 per cent as of December 31, 2024, and 15.5 per cent as of September 30, 2024. The stock has rewarded investors, rising 59 per cent in the past six months. The stock gained, even as there are concerns over the heightening competition in the quick commerce space.
Recently, Amazon Now, the quick commerce (QCom) business of Amazon, expanded its operations to Mumbai, after Bengaluru and Delhi. While the footprint remains small compared to incumbents, 100 dark stores versus 1,544 for Blinkit and 1,062 for Swiggy, Amazon has the capital as well as the ambition to scale it up, anlaysts noted.
"However, we believe that incumbents are better placed – creating almost an entirely new supply chain for its QCom business will be a challenge for Amazon, given that incumbents have an advantage of being top-of-the mind recall apps for a large pool of customers. More competition is a feature of the land grab phase, in which adjacent players enter the market which drives market expansion and growth," Emkay said.
While excessive competition will weigh on profitability, Emkay said consumer stickiness to help incumbents retain customers. Once industry growth slows down, this brokerage sees a consolidation phase to follow, which will result in sub-scale players folding operations and driving profitability.
"Blinkit is executing well in the QCom space. We retain buy on Eternal with a target price of Rs 330," it said.
MOFSL noted that food delivery (FD) growth slowed due to weak consumption and macro pressures, while quick commerce (QC) profitability came under strain from heightened competition, accelerated dark store rollouts, and elevated customer acquisition costs.
"We now believe the cycle is turning," it said.
This brokerage has raised food delivery growth estimates to 21-23 per cent for FY26-FY27 (19-20 per cent earlier), value the business at 35 times FY27E Ebitda. It also tweaked its profitability assumptions for quick commerce for Blinkit. MOFSL suggested 'Buy' and a target of Rs 420 for Eternal.