Eternal Ltd. , the parent company of quick commerce platform Blinkit, is set to implement a significant change in its business strategy. Starting September 1, Blinkit will transition from a marketplace model to an inventory-led business model, a move that is expected to have positive implications for the company's financial performance.

Anticipated Financial Impact

The shift in Blinkit's operational model is projected to yield substantial benefits for Eternal Ltd.:

• Margin Improvement: The company anticipates an enhancement in Ebitda (Earnings Before Interest, Taxes, Depreciation, and Amortization) margins ranging from 50 to 110 basis points.
• Path to Profitability: This strategic pivot is expected to accelerate Blinkit's journey towards profitability, with the potential to achieve Ebitda break-even by the third quarter of fiscal year 2024 (Q3 FY24).

Analyst Perspective

JM Financial, a prominent financial services firm, has expressed a positive outlook on Eternal Ltd.'s stock following this announcement:

• Rating: JM Financial maintains a 'buy' rating on Eternal Ltd.'s stock.
• Target Price: The firm has set a target price of Rs 320.00 for the stock.

This optimistic stance from JM Financial suggests confidence in the potential success of Blinkit's new business model and its positive impact on Eternal Ltd.'s overall performance.

Strategic Implications

The transition to an inventory-led model represents a significant shift in Blinkit's operational strategy. This move is likely aimed at:

1. Improving control over product quality and availability
2. Enhancing operational efficiency
3. Potentially reducing costs associated with third-party sellers

As Blinkit implements this new model, investors and industry observers will be keenly watching its impact on the company's financial metrics and market position in the competitive quick commerce sector.

Eternal Ltd.'s decision to pivot Blinkit's business model underscores the dynamic nature of the e-commerce and quick commerce landscapes, where companies must continuously innovate to improve profitability and maintain a competitive edge.

Eternal Ltd. , a prominent player in the food delivery sector, has announced a significant leadership transition in its food delivery business. The company is set to see a change at the helm, with current CEO Rakesh Ranjan stepping down and Aditya Mangla poised to take over the reins.

Leadership Transition

Rakesh Ranjan, who has been serving as the CEO of Eternal Ltd.'s food delivery business, will be stepping down from his position on July 6. This move marks the end of Ranjan's tenure at the helm of one of India's key players in the competitive food delivery market.

New Leadership

Stepping into the role of CEO will be Aditya Mangla, subject to board approval. Mangla is not new to the company; he currently holds the position of head of product for food ordering and delivery at Eternal Ltd. This internal promotion suggests a strategy of continuity and leveraging insider knowledge of the company's operations.

Appointment Details

The board of Eternal Ltd. is scheduled to meet on July 5 to approve Mangla's appointment. If approved, Mangla will assume the role of CEO for a term of two years, providing a clear timeframe for his leadership mandate.

Implications for Eternal Ltd.

This leadership change comes at a crucial time for Eternal Ltd.'s food delivery business. The food delivery sector in India has been experiencing rapid growth and intense competition. The transition from Ranjan to Mangla may bring new strategies and focus areas to Eternal Ltd.'s operations in this dynamic market.

Mangla's background in product development for food ordering and delivery could potentially lead to innovations in user experience and service offerings. His intimate knowledge of the company's current product strategy might also ensure a smooth transition and continuity in ongoing projects and initiatives.

As Eternal Ltd. navigates this leadership change, stakeholders will be keenly watching how it impacts the company's position in the competitive food delivery landscape. The effectiveness of this transition and Mangla's leadership will likely play a crucial role in shaping Eternal Ltd.'s future in the food delivery sector.