Eternal Ltd., formerly known as Zomato, has seen its shares rally significantly, gaining 35% from its 52-week low three months ago and an additional 11% in the last week. Market experts are optimistic about the stock's future performance, driven by the strong growth prospects of its quick commerce arm, Blinkit, and the anticipated IPO of peer company Zepto.
Why Analysts Are Bullish on Eternal Shares
Brokerage firms are maintaining a positive outlook on Eternal, citing a combination of robust fundamentals and improving technical indicators. The company’s Blinkit business is strategically positioned to capitalize on India's burgeoning quick commerce sector, despite increasing competition. Analysts believe that platforms with strong execution capabilities and healthy balance sheets will thrive in this competitive landscape.
Anand Rathi, a prominent brokerage, emphasized that quick commerce is no longer a luxury but a fundamental shift in urban retail. They highlighted Blinkit’s clear scale advantage and strong customer retention, which reduce reliance on heavy discounts. Anand Rathi maintains a 'buy' rating on Eternal, setting a target price of Rs 400.
Technical Indicators Signal Further Gains
Eternal's stock has shown a decisive technical breakout, moving above a downward-sloping trendline near the Rs 250 level, followed by a successful retest around Rs 237. This indicates a strengthening bullish setup. The stock is currently trading above all key daily exponential moving averages (DEMAs), reinforcing the positive trend, while the 14-day Relative Strength Index (RSI) suggests neutral-to-bullish momentum with room for further upside.
Canara Bank Securities noted that trading volumes have remained significantly above the 10-day average, reflecting strong investor participation. They identify the Rs 290-308 zone as the next major resistance, with Rs 253-235 acting as immediate support. Canara Bank Securities recommends a 'buy' with a short-term target of Rs 275-291 and a stop loss at Rs 247.
Consolidation and Buying Opportunities
Bajaj Broking Research highlighted that Eternal has turned technically positive after breaking above a key falling trendline, signaling a reversal of its corrective phase and offering fresh buying opportunities. A bullish crossover of the 20-day and 50-DEMAs further strengthens this momentum. After consolidating in the Rs 235-265 range for the past nine weeks, Bajaj Broking anticipates the stock to resume its uptrend, potentially moving towards Rs 290 in the coming months, with immediate support at Rs 235-240.
Laxmikant Shukla, Technical Research Analyst at YES Securities, observed that Eternal has rallied over 25% since mid-March and recently posted a range breakout, accompanied by a bullish MACD crossover. While a short-term consolidation might occur after the sharp move, he suggests that dips into the Rs 268–270 zone offer a better risk-reward entry. A sustained move above Rs 280 could lead to an advance towards Rs 300, provided Rs 255 holds as a support level.