Eternal Limited , formerly known as Zomato Limited, has received a Goods and Services Tax (GST) demand order from the Deputy Commissioner, State Tax, Lucknow, Uttar Pradesh. The order, dated August 6, 2025, pertains to the period from April 2021 to March 2022 and involves a total liability of ₹1.35 crore.

GST Demand Details

The order confirms a GST demand of ₹67.25 lakh along with an equal penalty amount, totaling ₹1.35 crore. The demand is related to alleged short payment of output tax and excess availment of input tax credit during the specified period.

Company's Response

Eternal Limited has stated that it believes it has a strong case on merits and plans to file an appeal against the order before the appropriate authority. The company disclosed this information in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Financial Impact

Despite the substantial demand, Eternal Limited does not anticipate any financial impact from this matter. The company's confidence in its position suggests that it expects a favorable outcome in the appeal process.

Regulatory Compliance

The company promptly informed the stock exchanges about this development, demonstrating its commitment to transparency and regulatory compliance. The disclosure was made to both the BSE Limited and the National Stock Exchange of India Limited.

Looking Ahead

As Eternal Limited prepares to contest the GST demand order, stakeholders will be watching closely to see how this issue unfolds. The company's ability to successfully navigate this regulatory challenge could have implications for its financial statements and investor confidence in the coming months.

Investors and market observers are advised to keep an eye on further updates from the company regarding the progress of its appeal and any potential resolutions with the tax authorities.

Eternal , the parent company of popular platforms Zomato and Blinkit, has reported a significant expansion in its workforce, more than doubling its employee count to 16,375 in FY25. This surge has propelled the company beyond Tata Consumer Products, which currently employs 10,595 individuals.

Rapid Expansion and Its Drivers

The substantial growth in Eternal's workforce is attributed to several factors:

• Expansion in the quick-commerce sector
• Growth in the going-out business segment
• Recent acquisitions in the entertainment ticketing industry

Financial Implications of Workforce Growth

The company's employee-related financials have seen notable changes:

• Employee benefit expenses increased by 54% to ₹2,558.00 crore
• Share-based payments saw a significant jump of 55%, reaching ₹798.00 crore

Compensation Trends

Despite the overall increase in expenses, there are interesting trends in employee compensation:

• Average pay for non-managerial employees decreased by 23-26%
• This decline is due to a higher proportion of lower-salaried staff in customer support and operations roles
• Independent directors' compensation increased fourfold to ₹1.00 crore
• CEO Deepinder Goyal continues to waive his salary until March 2026, demonstrating a commitment to the company's growth

Employee Turnover

Eternal has experienced an increase in employee attrition:

• The attrition rate rose to 44% from the previous 37%
• This increase is attributed to internal transfers and higher turnover in frontline roles

Analysis

The contrasting trends of workforce expansion and declining average pay highlight Eternal's strategic focus on rapid growth, particularly in operational areas. While the company is investing heavily in its workforce, the shift towards a larger proportion of frontline staff has impacted the overall average compensation.

The significant increase in share-based payments suggests a strategy to align employee interests with company performance, potentially offsetting the decline in average cash compensation for some employees.

The rise in attrition rates, while concerning, is not uncommon in fast-growing companies with a large frontline workforce. However, it may present challenges in maintaining operational stability and could lead to increased training and recruitment costs.

Eternal's ability to manage these workforce dynamics while continuing its expansion will be crucial for its long-term success in the competitive quick-commerce and food delivery markets.