Eternal delivers mixed Q1; Reliance's qcomm gameplan

Time of India

7 days ago

Eternal delivers mixed Q1; Reliance's qcomm gameplan
Also in the letter:
Eternal Q1 profit crashes 90% even as Blinkit outpaces Zomato
Why it matters:
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Key metrics:
NOV for B2C businesses: Rs 20,183 crore, up 55% YoY
Rs 20,183 crore, up 55% YoY Adjusted revenue: Rs 7,563 crore, up 67%
Rs 7,563 crore, up 67% Quick commerce NOV: Rs 10,408 crore
Rs 10,408 crore
Food delivery NOV: Rs 9,774 crore
What's new:
CEO Deepinder Goyal said Bistro's demand is solid and hasn't hurt Zomato orders, though turning a profit remains a work in progress.
Market response:
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Reliance won't shop for quick commerce players
Sitting out:
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By the numbers:
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What's next:
India may allow China investments if tech comes with it
Changing times:
Between the lines:
State of play:
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Necessary evil:
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Gaming firms hit with fresh GST blow over cashback credits
Served:
Flawed logic:
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What they're saying:
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Microsoft issues urgent alert on SharePoint server hacks
Bait and switch:
Legacy issues:
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Blinkit's boost in June quarter revenue could not prevent the profit nosedive of Zomato's parent company. This and more in today's ETtech Top 5.■ China's doorway into India■ Difficulty level: GST■ Microsoft under attackEternal, the parent company of Zomato and Blinkit, saw its net profit tumble 90% year-on-year (YoY) to Rs 25 crore for the June quarter, despite a 70% jump in revenue to Rs 7,167 crore.The sharp decline is mainly due to increased expenditure on quick commerce and the company's expanding offline and 'going-out' verticals.For the first time, Blinkit's net order value (NOV) overtook Zomato's food delivery business over an entire quarter. It is a telling shift in Eternal's growth story—quick commerce now accounts for more than half of its total NOV.Eternal is incorporating a new subsidiary, Blinkit Foods , at a time when it is expanding 10-minute food delivery through "Bistro" kitchens. It currently has 38 such kitchens in Delhi-NCR and Bengaluru, and they churn out low-cost meals and snacks, aiming to reach customers in under 10 minutes. Shares rose over 7% intraday on the back of strong top-line momentum and Blinkit's growing scale. This also marks Eternal's 11th straight quarter of 50%-plus adjusted revenue growth.Source: Google FinanceAs Blinkit and Swiggy's Bolt double down on ultra-fast food delivery, profitability remains out of reach. Eternal's earlier attempts—Zomato Everyday and Quick— failed due to unreliable infrastructure . The competition for quick food dominance continues—but no one has yet cracked the economics.Reliance Retail has no plans to acquire quick-commerce startups , arguing that their cost structures are unsustainable and integration too messy. Instead, it's doubling down on organic growth, tapping into its vast offline store footprint and logistics backbone to scale more efficiently.India's quick-commerce market has reached $10 billion, with 30 million monthly users; however, turning a profit remains challenging, especially outside major cities. Reliance says it only builds dark stores where volumes demand it and existing stores fall short. 'Most of my dark stores are contribution-positive from day one,' CFO Dinesh Taluja told us.Reliance's daily hyperlocal orders jumped 68% quarter-on-quarter and 175% year-on-year in Q1 FY26. Ajio Rush, its four-hour fashion delivery service , launched across six cities, now offers over 1.3 lakh styles and has early signs of 'promising unit economics.'As rivals like Myntra (M-Now), Newme, and Slikk intensify their fashion Q-commerce efforts, Reliance is backing dense order volumes, premium SKUs, and low return rates, without splurging on mergers and acquisitions.ETtech Top 5 and Morning Dispatch are must-reads for India's tech and business leaders, including startup founders, investors, policy makers, industry insiders and employees.Interested? Reach out to us at [e-mail] to explore sponsorship opportunities.India is set to ease curbs on Chinese investments in electronics—but only through joint ventures with Indian partners and with real technology transfer on the table.It indicates a possible change under Press Note 3, which limits FDI from countries sharing land borders with India. Officials state that the IT ministry backs the move to help Indian firms develop capabilities to increase component manufacturing. The goal is to raise local value addition from 20% to 38% within five years, aligning it with China.Basic assembly partnerships will not be accepted. Only proposals that offer clear intellectual property or manufacturing expertise will be approved, according to officials. JV proposals from Dixon, Micromax, and others are currently under review.India's smartphone output reached $64 billion in FY25, with $24 billion in exports; however, informal Chinese trade curbs and rare earth supply issues are emerging threats.MeitY will still prioritise national security concerns, but officials say the broader aim is to develop a strong domestic ecosystem. For that, some Chinese collaboration might be an unavoidable necessity.Real-money gaming companies are facing fresh heat from tax authorities , this time over cashbacks and promotional credits.The Goods and Services Tax (GST) department has issued notices to at least four firms, arguing that these non-withdrawable bonuses still qualify as 'consideration' under Rule 31B, and are therefore taxable.This adds to the industry's mounting troubles, already battling steep retrospective tax demands for 2017-2023. Industry insiders say the department's stance on bonuses is a 'misread' and plan to challenge it in court.'This has serious implications… we've been pressured to make voluntary payments,' said one gaming executive in a private group, who plans to approach the Supreme Court. Legal experts argue bonuses aren't part of taxable turnover.Platforms rely on sign-up bonuses and cashback offers to grow and retain users. Taxing these could upend business models already under pressure from the 28% GST on full contest value.Microsoft has raised the alarm over active cyberattacks targeting on-premise SharePoint servers, widely used by businesses and government bodies for internal file sharing.The company confirmed that this is a zero-day vulnerability and urged customers to apply security patches immediately.The flaw permits network spoofing, enabling attackers to impersonate trusted users and gain unauthorised access to sensitive systems. SharePoint Online, part of Microsoft 365, remains unaffected. However, on-premises versions from 2016 and 2019 are vulnerable.Tens of thousands of organisations still rely on self-hosted SharePoint servers. Microsoft is collaborating with CISA, the US Department of Defense, and the FBI, which is now investigating. Unpatched systems, the company says, should be taken offline as a precaution.The warning comes amid a surge in state-sponsored cyberattacks targeting critical infrastructure. Earlier this year, Microsoft faced criticism after vulnerabilities in its Exchange server were exploited.