Eternal shares jump 4% today; JM Financial target hints at 73% further upside

Eternal Ltd shares climbed for the second straight session in Tuesday’s trade, gaining as much as 4.2% in early deals to touch a day’s high of Rs 231.35 apiece on the BSE.This recent bounce offers a breather for the stock, which had slipped 20 times in the last 24 sessions, declining nearly 25% in the same period. 

However, brokerage JM Financial believes the recent sell-off presents a buying opportunity. The brokerage maintains a ‘Buy’ rating on Eternal with an unchanged target price of Rs 400. From Tuesday's high, that translates to an upside of nearly 73%. 

The brokerage said that investors with a 12 to 18-month horizon should "aggressively accumulate" the stock at these attractive levels. 

“While we are cutting target NTM PE to 65x (from 75x) factoring in global macros and competitive risks, our TP is unchanged at INR 400 on a rollover to Mar’27E,” JM said.

JM Financial said Blinkit is structurally well-positioned to handle the heat thanks to a clear scale advantage. Blinkit boasts the industry's most mature supply chain with 2,027 dark stores and commands strong customer retention without relying on heavy discounts. 

A major growth engine for Eternal remains its quick-commerce arm, Blinkit. Rivals are stepping on the gas, with Flipkart-owned Minutes reportedly adding around 100 dark stores every month and Amazon-owned Now rolling out two stores a day, JM noted.

The brokerage expects Blinkit to deliver around 80% growth in gross order value for the 2027 financial year. On the food delivery front, concerns over supply-side disruptions—specifically regarding gas availability due to Middle East tensions—are likely overstated. 

JM Financial noted that even if 25% of orders are disrupted in the final weeks of the quarter, the segment could still deliver 15% year-on-year growth.