Eternal share price looks set to close flat in May; opportunity to buy?

Eternal share price rose over 3 per cent in intraday trade on the NSE on Friday, May 30, shrugging off weak market sentiment and looking set to extend gains to the second consecutive session. Eternal share price opened at ₹226.56 against its previous close of ₹228.37 and rose 3.2 per cent to an intraday high of ₹235.65. Around 11:15 AM, the stock traded as the top gainer in the Nifty 50 index, up 2.93 per cent at ₹235.05. The Nifty 50 was 0.31 per cent down at 24,756 at that time.

Eternal share price trend

While the stock has been in the green since Thursday, it has been consolidating recently. It appears poised to end the week in the red, which would mark its second consecutive weekly loss. For the month of May, the stock is nearly flat. In the calendar year 2025, the stock has declined by 18 per cent.

Over the last year, the stock has gained 25 per cent, hitting a 52-week high of ₹304.70 on December 9 and a 52-week low of ₹146.30 on June 4 last year.

Eternal Q4 results

Eternal reported a 77.7 per cent fall in its Q4FY25 consolidated net profit at ₹39 crore versus ₹175 crore reported in the year ago period. The revenue from operations in Q4FY25 stood at ₹5,833 crore, which was up by 63.8 per cent over ₹3,562 crore in the corresponding quarter of the previous financial year.

After Q4 results, brokerage firm Axis Securities downgraded the stock to 'hold', citing that there could be pressure on the near-term margins due to increased competition.

"From a long-term perspective, Zomato (Eternal) has built a resilient business model by securing multiple strategic verticals and delivering broad-based growth. However, near-term challenges—rising competitive intensity, rapid store expansion, and subdued demand in the food delivery business—are likely to keep profitability under pressure. Consequently, we downgrade the stock to 'hold' and value it at ₹230 per share based on an SOTP valuation," said Axis Securities.

Eternal: Is the recent correction in the stock an opportunity to buy?

Some fundamental experts believe Eternal's growth story makes it an attractive bet for the long term despite near-term headwinds due to increased competition. 

Sneha Poddar, VP- research, wealth management at Motilal Oswal Financial Services, believes that this stock should be bought for the long term.

"We believe Blinkit's scale and first-mover advantage justify near-term losses. Investors should brace for volatility but stay focused on the structural growth story, and thus, yes, consolidation in prices is an opportunity to buy," said Poddar.

Poddar pointed out that Eternal's Q4 performance was driven by Blinkit's explosive NOV growth (+121 per cent YoY on a like-for-like basis), though profitability remains pressured by aggressive dark-store expansion and rising competition.

While food delivery showed stable 16 per cent YoY GOV growth, Blinkit's EBITDA losses widened (-2.4 per cent of NOV) due to customer acquisition costs and underutilised stores.

"Because of these costs, management expects competitive intensity to persist, delaying Blinkit's breakeven to FY27. However, the long-term opportunity in quick commerce remains compelling, with Eternal well-positioned as a market leader," Poddar noted.

Technical experts appear largely positive, but some point out that traders and investors should wait for a decisive breakout before buying this stock.

Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers, highlighted that at the current juncture, Eternal has taken support around the ₹220–225 zone, which aligns with the S3 Camarilla pivot level.

Additionally, the RSI on the hourly chart indicates a hidden bullish divergence, suggesting a potential upside move toward the ₹250 mark.

"We recommend going long in the ₹228–232 range, with a stop loss below ₹220 and a target of ₹250," said Patel.

According to Kunal Kamble, Senior Technical Research Analyst at Bonanza, Eternal has been consolidating in a tight range of ₹218– ₹247 for the past 45 days, with declining volumes indicating reduced participation. The narrow 28.54-point range suggests a breakout is imminent.

Kamble underscored that buyers have consistently defended dips, and a breakout above ₹247 could trigger a rally towards ₹260– ₹280. Conversely, a breakdown below ₹218 may lead to a decline towards ₹198– ₹190.

"The stock is currently at a crucial juncture, and traders should watch for a decisive move beyond the established range to confirm the next directional trend. A breakout or breakdown will likely be accompanied by a surge in volumes," said Kamble.

Mandar Bhojane, an equity research analyst at Choice Broking, believes a sustained close above the key level of ₹247 could act as a breakout trigger, opening the path for upside targets of ₹280 and ₹305 in the near term.

On the flip side, Bhojane said ₹220 remains a crucial support level, and dips toward this zone may be considered healthy retracements within the range.

"Momentum-wise, the RSI at 49.72 is flat, indicating a wait-and-watch sentiment, but a move above 50 could confirm renewed strength. For prudent risk management, traders may consider placing a stop-loss at ₹215," said Bhojane.

Shitij Gandhi, Senior Research Analyst (Technicals) at SMC Global Securities, pointed out that the stock is currently hovering around its 200-day exponential moving average (EMA) on the daily charts.

Secondary oscillators indicate continued consolidation, with the stock likely to trade within a broader range of 220-250 in the near term. In the absence of a clear directional move, the stock may remain rangebound in the coming weeks as well, Gandhi said.

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Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions, as market conditions can change rapidly, and circumstances may vary.