ETERNAL LIMITED

Aditya Soman

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Akshant Goyal

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Akshant Goyal

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Vivek Maheshwari

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Vivek Maheshwari

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Akshant Goyal

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Swapnil Potdukhe

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Swapnil Potdukhe

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Akshant Goyal

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Akshant Goyal

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We have seen a slight decline there because of the market and the competition being where they are on the delivery fee.

— Akshant Goyal

While the decline is not significant, but yes, it has partly contributed to the decline in take rate that you see.

— Akshant Goyal

Any impact of that on the food consumption based on what you've seen?

— Ankur Rudra

The newsletter mentions about broad-based slowdown, and this is a comment from other consumption-oriented companies as well.

— Vivek Maheshwari

A lot of this increase is an impact of that.

— Vivek Maheshwari

Some of it also because of the impact of higher ASP categories like electronics actually becoming larger for us.

— Vivek Maheshwari

We will see the impact of increased competition on the cost of presenting ourselves to the customer, which is primarily our digital marketing cost today.

— Vivek Maheshwari

If you open a store in an existing area, it doesn’t necessarily cannibalize the existing sales of an existing store, but it does lead to a slowdown in the ramp-up of that store.

— Akshant Goyal

My first question is that we clearly saw some slowdown in food delivery, but for quick commerce, are you seeing a slowdown in mature stores and among mature users?

— Sachin Salgaonkar

If not, should we expect some kind of slowdown in sync with the macro economy?

— Sachin Salgaonkar

Overall, it seems like you're being a bit cautious about the whole 15-minute food delivery offering from restaurants, relatively speaking.

— Vijit Jain

Is that why you seem a bit more cautious about it?

— Vijit Jain

One of the reasons I ask this is because, while there is a cost associated with expansion as you scale from 1,000 to 2,000 stores, I'm trying to understand if there is any pressure on profitability for your top 50 to 150 store cohorts, given that you might be undertaking customer retention initiatives.

— Rishi Jhunjhunwala

Q

Hi, good evening. I have two questions. Firstly, can you elaborate a little more on the take rate in quick commerce coming off? While you've explained why we've seen profitability worsen because you've brought forward the acceleration in stores and warehouses, can you talk about take rate? And the second question, a related question, why do you feel so confident about profitability improving in quick commerce? I understand store maturity. Can you give us a sense of what proportion of stores will be mature, let's say, in FY26? Thank you.

Albinder Singh Dhindsa

I'll take the take rate question. Aditya, the take difference that you see every quarter-on-quarter is usually just a mix of the product mix itself. OND is typically a quarter where we also see more sales of electronics products, general merchandise and some of the other categories, where percentage wise take rates are lower, but overall revenue profile is healthier. So that's usually the delta that you see. There is no significant trend for the take rate in the quarter that we've observed for the core or for the non-core categories. I understand. Thanks, very clear. Aditya, on your second que

Q

Thank you. The first question is about the reason for the accelerated additions and bringing the growth forward. Is this because you see a bigger opportunity in the market versus before, or are you matching competition in the space? And secondly, to stick with the city side, our data says you've gone very long in terms of covering over 80 cities probably. Can you talk about the opportunity you see beyond the top 10 or 20 cities, which we previously understood was a core value proposition and how the unit economics, the average bill values and the time to breakeven changes here?

Akshant Goyal

Hi Ankur, Akshant this side. I don't think we took a very conscious call on accelerating the store expansion. It's more of an outcome of the work that we've been doing in the past many months. It just happens that we were able to add a lot more new stores than what we envisaged maybe a year ago when we gave the guidance of getting to 1,000 stores by March-25. Over the last one year, we've built organization bandwidth to be able to expand faster, and the increasing confidence in business is therefore allowing us to continue at that pace. The pace of expansion going up has nothing to do with any

Q

Hi, good evening team. I have a couple of questions. First is on the food delivery side. The newsletter mentions about broad-based slowdown, and this is a comment from other consumption-oriented companies as well. Do you think for you as a company, or for this as a category, it will moderate further before it starts picking up? Your letter mentions again that things are expected to pick up. What do you think? Because a lot of consumer companies are talking about urban seeing more moderation in the foreseeable future before it gets better? What is your take?

Akshant Goyal

Look, I don't want to crystal ball gaze here; these things are very hard to predict. They are a function of a lot of variables, most of which are not in our control. At this point, I don’t want to comment on how this recovery will pan out. But yes, what we know is what we have reported, and then we see how it unfolds from here. Okay. And through the course of the latter half of the quarter, from November to December, was it broadly stable, or was there any change during those few weeks? It's a very short time period, and it’s also influenced by a lot of seasonality, such as festivals, winters

Q

Hi, thanks for the opportunity. My first question is on Blinkit. Earlier, we used to provide a data point stating that it took approximately two months for a store to reach 1,000 orders per day. I would just like to know the time it now takes for the newer stores, which have been opened in recent months, to reach this number, as this is the point where we typically become contribution positive. Additionally, does the densification of our store network in some cities directly impact the throughput of existing stores due to cannibalization?

Akshant Goyal

Hi, Swapnil, on your first question, there is broadly no material change in terms of the breakeven point compared to what we had shared earlier. If there is, we will certainly inform all the investors and update them. But as of now, we’re still operating within the same ballpark, seeing store breakeven in around two to three months. This answer also relates to your next question. Some of this also depends on what that new store represents. Is it in a new area, a new city, or an additional store in an existing neighborhood? However, for the overall aggregate group of new store additions, that t

Q

Hi guys. I have a couple of questions. Firstly, on the top 50 stores, which are obviously mature stores and have a very high throughput and a contribution margin of 6.4%. Is this the peak we can expect, or is there potential for the contribution margin to increase even for these stores? If so, what factors would lead to further expansion, if any?

Akshant Goyal

I don’t think this is the peak. Even for the more mature stores, there is a fair bit of cost that we are paying due to operating in a competitive market, which impacts the delivery fee that we charge consumers and the last mile cost that also applies to these stores. So, all of that in long term will change. As the business scales, our gross margins or sourcing margins should improve, and so should our ad income. The contribution margin, the way we define it, also includes a lot of fixed costs, which are fixed in nature, including back-end warehousing costs, employee costs, and so on. There’s

Q

Thanks, everyone. I just have one question. So, you mentioned heightened marketing spending in the third quarter. Would you say that this was evenly spread throughout the quarter, or did the heightened activity occur from mid-November onwards, particularly in December? Or was it more uniform throughout the quarter? Albinder Singh Dhindsa: Gaurav, it was not uniform. It was definitely more backloaded for us because the first half of the quarter was primarily the festival season, where we were already fairly close to our capacities, so we didn’t really need to spend as much on marketing. Also, i

Gaurav Malhotra

Just a quick question on dark stores. You mentioned that you have advanced your guidance of reaching 2,000 stores by the end of December. However, in terms of the impact on losses, you have indicated it will affect the next one or two quarters. Should we then assume that the next 1,000 stores will mostly come in the next two quarters and will not be as back ended? Albinder Singh Dhindsa: Gaurav, it will be a little more dynamic because we've added, I would say, almost 300 stores over the last four or five months. Some of these stores, towards the second half of the year, will also start maturi

Q

Hi, congrats on reaching the milestone of 1,000 stores ahead of your schedule. My first question is about the key drivers for food delivery margins. You did mention the platform fee, but did the delivery cost also come down in that business? Additionally, what drives your confidence in margins reaching 5% in the next few quarters? What would be the key drivers?

Akshant Goyal

Hi Gaurav. I don't want to be too specific here, given that it's competitively sensitive. But in general, as we have mentioned in the past, the business economics here are a function of multiple levers, and it's the small optimizations that add up and result in margin expansion. So, we continue to drive confidence from the progress we are seeing across various parts of the business, including delivery costs, the consumer fee increasing, AOV going up, and so on. Unfortunately, we can't be more specific than that, but that's where we are. Okay. I'm just trying to understand—this optimization is

Q

Hi. Thank you for the opportunity. I have a few questions. My first question is that we clearly saw some slowdown in food delivery, but for quick commerce, are you seeing a slowdown in mature stores and among mature users? If not, should we expect some kind of slowdown in sync with the macro economy? Albinder Singh Dhindsa: Nothing so far, Sachin.

Sachin Salgaonkar

Got it. From a competitive perspective, how should one think about this? Is it affecting all operators across the board, or just select one or two platforms? The reason I'm asking is that I'm trying to gauge how long this could continue. Albinder Singh Dhindsa: Sachin, your guess is as good as ours. We don’t have a definitive point of view on this, we see all competition as just competition. Our focus is to do our job better and do what is right for our business. So, I don't think we are focused on, or even able to, differentiate between one competitor and another. Got it. As of now, one gets

Q

Thank you. My first question is on food delivery. Just taking off from what Sachin asked earlier, your response in that question seems to acknowledge Zomato Instant, which you had experimented with earlier. Overall, it seems like you're being a bit cautious about the whole 15-minute food delivery offering from restaurants, relatively speaking. Is that interpretation, correct? And secondly, if so, is it because you think it's harder to achieve the desired metrics, NPS, or other performance indicators? Is that why you seem a bit more cautious about it?

Akshant Goyal

Vijit, that's not the case. The less-than-15-minute delivery offering on Zomato is something that we're very excited about. However, all these initiatives, whether it is Zomato’s 15-minute delivery or Bistro, are still very, very nascent. It's not significantly moving the needle today. What we know for sure is that quick deliveries lead to more demand, that is a fact. But finding the right approach to achieve that demand is still in the early stages. It's too soon to determine which models will work, which will be sustainable and profitable, and which will be scalable enough to significantly m

Q

Thanks for the opportunity. I have a slightly different way of asking customer-related questions. Can you provide some insight into your customer acquisition costs in areas where you are expanding but where a competitor is already present? Also, what are your customer retention costs in areas where you are already established, but a peer is entering and being very aggressive? One of the reasons I ask this is because, while there is a cost associated with expansion as you scale from 1,000 to 2,000 stores, I'm trying to understand if there is any pressure on profitability for your top 50 to 150

Rishi Jhunjhunwala

So, just to conclude on that, is it fair to assume that, sequentially, in your top 300 dark stores, your profitability has actually not declined quarter-on-quarter? That's right. Broadly, Rishi, what has changed, as we've also mentioned in our response to question five, is that for the slightly older business, as you're saying, the margin expansion has paused. However, our margins are broadly still intact, they haven't fallen. Understood. Thank you so much.

Q

Hi, and thanks for doing the call. I'm just trying to think about the losses and understand them in two areas, one in terms of competition and the other in terms of infrastructure setup. Would you say that, for this quarter or based on what you're witnessing now in January, the larger variable for loss increase going forward will primarily be the setup of infrastructure, particularly as you scale from 1,000 stores to 2,000 stores? Is that the right way to think about it? What I'm broadly trying to understand is whether, with all the interventions you plan to implement, is there a theoretical l

Akshant Goyal

We're not thinking that way, Manish. We are not operating with a mindset of capping losses, because our mental model or framework here is that if the underlying core business is strong and if we have the bandwidth, capacity, or capability to expand at a faster pace than we are today, then we will do so. Losses will just be an outcome of that. We're not operating with a fixed budget for expansion at this point, given that the market is very large, and we clearly see a first-mover advantage in reaching consumers first. Therefore, we'll scale as fast as we can. And would you say that the larger p