Synopsis:
Eternal Ltd and Swiggy Ltd are in focus after Nomura has assigned a new target price with a Buy rating.

One of the leading brokerage firms, Nomura, has given a new target price for two prominent stocks, based on its latest assessment of their financial performance, growth potential, and prevailing market trends.

Following are the list of stocks with new target price  

1. Eternal Ltd

Nomura has maintained its ‘Buy’ rating on the stock and raised the target price from Rs. 300 to Rs. 370, with an upside of 11.90 percent from CMP of Rs. 330.65 Nomura citing steady growth and improving profitability in food delivery, a bottoming out of quick commerce contribution margins, benefits from a QC inventory-led model aiding margin expansion, and sustained leadership in both food delivery and quick commerce.

About the Company 

Eternal (Zomato) Limited is an internet platform connecting users, restaurants, and delivery partners. Its operations include India food ordering and delivery, Hyperpure B2B supplies for restaurants, and quick commerce for fast delivery of essentials, along with advertising services and ingredient supply for restaurant partners in India and abroad.

With the market capitalization of Rs. 3,19,088.84 crore, the shares of Eternal Ltd are trading at Rs. 330.65, up by 0.46 percent from its previous day’s close price of Rs. 329.15 per equity share. 

Zomato has recently increased its platform fee from Rs. 10 to Rs. 12 per order (excluding GST), following last year’s rise from Rs. 6 to Rs. 10, a move likely to boost the company’s revenue during the high-demand festive season.

In Q1FY26, the company reported revenue of Rs. 7,167 crore, up 70.4 percent YoY from Rs. 4,206 crore in Q1FY25 and 22.9 percent QoQ from Rs. 5,833 crore in Q4FY25. However, profit declined sharply to Rs. 25 crore, down 90.1 percent YoY from Rs. 253 crore and 35.9 percent QoQ from Rs. 39 crore in the previous quarter, indicating strong top-line growth but significant margin pressure.

At the moment, the company’s P/E ratio is 1,068x higher as compared to its industry P/E 29x. The company’s ROE and ROCE are 6.55 percent and 7.34 percent respectively, and the D/E ratio of 0.01, indicates the company’s financial performance.

2. Swiggy Ltd

Nomura has maintained its ‘Buy’ rating on the stock with the target price of Rs. 550, implying an upside of 22.82 percent from current market price of Rs. 447.80. Nomura highlighted strong cash reserves to withstand competition, a profitable and cash-generating food delivery business expected to grow at 20 percent CAGR in FY25-27, improving quick commerce profitability with low dilution risk, and forecasting a 120 bps rise in adjusted EBITDA margin over the same period.

About the Company

Swiggy, founded in 2014, is India’s leading consumer-first technology platform that provides a single app for food delivery, groceries, household essentials, restaurant reservations, and local events.

Swiggy has established itself as a trusted, category-defining brand by leveraging a large partner network, reusable technology stack, and horizontal membership program. To ensure inclusive and long-term impact, the company prioritizes responsible growth, including support for delivery partners and restaurant associates, promotion of EV adoption, and use of sustainable packaging

With the market capitalization of Rs. 1,11,653.04 crore, the shares of Swiggy Ltd is trading at Rs. 447.80, up by 1.99 percent from its previous day’s close price of Rs. 439.05 per equity share. 

Swiggy has increased its platform fee to Rs. 15 per order (including GST) in select cities, marking the third revision in three weeks. The fee was previously raised to Rs. 14 on Independence Day, later being reduced to Rs. 12. This represents the steepest hike since April 2023, when the platform fee was first introduced at just Rs. 2.

In Q1FY26, the company reported revenue of Rs. 4,961 cr, up 54 percent YoY from Rs. 3,222 cr in Q1FY25 and 12.5 percent QoQ from Rs. 4,410 cr in Q4FY25, reflecting strong sequential and annual growth.

However, net loss widened to Rs. 1,197 cr, compared with a loss of Rs. 661 cr in Q1FY25 and Rs. 1,081 cr in Q4FY25, indicating rising costs or pressures despite higher revenues.

Written by Akshay Sanghavi

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