Eternal's growth rate, risk-reward make it the preferred qcom bet

Competitive pressure in quick commerce to intensify in 2026

Shares of Eternal and Swiggy have been under pressure over the past three months, falling between 17 per cent and 19 per cent. They have underperformed the benchmarks and the broader indices, which have gained 1-1.5 per cent during this period. Higher competitive intensity and losses in the quick-commerce businesses have weighed on the outlook of the two e-commerce majors. But even as brokerages are cautious, Eternal has emerged as the better bet, given higher growth rate and better risk-reward equation. 

In the near term, key parameters would be growth rate and losses in the quick-commerce space and competitive intensity. 

Bernstein Research expects the industry to grow at 80 per cent in 2026, with more stores, discounts, and categories. Goldman Research, too, sees limited hurdles to expansion of the total addressable market for quick commerce, given its advantages on pricing, assortment and convenience. It estimates quick commerce has only about 5 per cent penetration of the underlying market. 

While Blinkit’s net order value has been growing at 100 per cent year-on-year (Y-o-Y) for the last six quarters, there is a low probability of this sustaining beyond the next two-three quarters, given the high base effect, according to Goldman Sachs. Though analysts led by Manish Adukia expect growth deceleration, it is expected to remain elevated, with 25 per cent plus Y-o-Y growth in net order value, at least till financial year 2030 (FY30). 

Even as the performance gap between leaders (Blinkit, Instamart, Zepto) and challengers (Flipkart, Amazon, BigBasket, JioMart) grew materially in 2025, Bernstein Research expects higher competitive intensity in 2026, with collective focus by leaders on core customer cohorts to lock-in unit economics, and effort by challengers to establish a foothold before it is too late. The brokerage expects aggressive discounting, especially in the first half of 2026, and store expansion. 

Margins of the top players are expected to be sacrificed for market share, given Eternal and Swiggy are flush with cash as they start 2026, and competitive intensity does not seem to be ebbing. The priority is to fight for market/customer share in each micro-market. 

Brokerages have a mixed view on the two listed majors. Bernstein Research has an “Outperform” rating on both Eternal and Swiggy. Jignanshu Gor and Parth Shah of the brokerage are positive on Blinkit’s ability to retain its leadership position. The current share price offers a more favourable risk-reward proposition, given established positive contribution margin, better operating metrics across the board, and a much lower cash burn, according to them. Most of the competitive pressure and resulting impact is already priced in, they said. 

They are also positive on Swiggy’s ability to leverage its newly developed cash cushion to grow its dark-store network, improve operating metrics, and subsequently, unit economics. In the medium term, with majority domestic ownership, Swiggy should also be able to transition to a first-party model, which allows better margins, reduces operational complexity, and simplifies regulatory adherence, said Gor and Shah. 

However, JM Financial Research has revised down the target gross order value multiple for Instamart from 0.5 times to 0.25 times, and lowered the target price for Swiggy’s shares to ₹400 from ₹460 apiece. Instamart is caught in the growth-profitability trade-off, the brokerage said. Analysts led by Swapnil Potdukhe said that adjusted operating losses in Swiggy’s Instamart business is expected to remain high at ₹800-900 crore per quarter for the next three-four quarters, due to high competitive intensity, take rate pressures (lower customer monetisation), and growing fixed costs (performance marketing spends). 

Goldman Sachs expects Eternal’s Q3 to be strong, though quick commerce growth could decelerate, even as margins expand. The market is not pricing in any meaningful margin expansion over the next two-three quarters. If Blinkit were to show reducing losses, Zomato’s stock could see a re-rating, it said. At the current share price, Blinkit’s implied enterprise value to operating profit on normalised margins (FY30) at 14 times is at the lower end of the brokerage’s India Internet peer group, despite a significantly superior growth profile, Goldman Sachs added.