ETERNAL LIMITED

Manish Adukia

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Manish Adukia

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Manish Adukia

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Manish Adukia

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Akshant Goyal

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Akshant Goyal

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Akshant Goyal

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Akshant Goyal

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Swapnil Potdukhe

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Swapnil Potdukhe

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The impact of competition is visible in the lack of significant margin expansion that we would have otherwise expected.

— Manish Adukia

That is both because there are now more players in the market, and there is obviously more competition across categories to market to the same set of customers which is leading to some margin pressure, both in terms of being able to charge higher delivery fees in some geographies and also in being able to sell more of the higher-margin categories on the platform.

— Manish Adukia

So, the answer to your question is that the pressure that you are seeing is all in the lack of margin expansion.

— Manish Adukia

So, anything you pick up, whether it is pressure on real estate costs, marketing cost, incentives, etc.

— Akshant Goyal

That's why we are saying that competitive intensity remains high, and therefore, the pressure on margin, that Albinder alluded to, stays.

— Akshant Goyal

In the quarter, we have 16% year-over-year growth and you explained quite well as to what's driven that slowdown.

— Manish Adukia

So, despite the slowdown, even in FY25, NOV / GOV, whatever you look at it, has grown 20%+.

— Akshant Goyal

And so, we are in a way paying for the risk of that through our commissions today.

— Albinder Singh Dhindsa

So, the full quarter impact of that is now leading to the higher income.

— Akshant Goyal

Albinder Singh Dhindsa: Aditya, it's very difficult to say, as I mentioned in the letter also.

— Aditya Suresh

Any signs of slowdown or is it still trending on the upward direction?

— Gaurav Rateria

Albinder Singh Dhindsa: Gaurav, overall, it has been growing, and we haven't seen any slowdown.

— Gaurav Rateria

And it's not like we haven't seen this kind of temporary pressure on supply in the short term.

— Akshant Goyal

We will see the supply increase and therefore, this pressure should ease off.

— Akshant Goyal

Last question, why is there a decline in the going-out business?

— Gaurav Rateria

Q

Thank you for the shareholders’ letter. As always, it is quite helpful. My first question is on the competition in quick commerce, which you said you expect to intensify in the future, particularly from next-day delivery platforms. Now the question here is that is that an expectation or are you already seeing that play out? And where is this higher competition showing up? I understand higher marketing costs, but your take rate and your contribution margins are both quite stable quarter-on-quarter. So does that mean that there has been almost no impact so far or any meaningful impact so far of

Manish Adukia

Thank you for that response. In the shareholder’s letter, you specifically talked about next-day delivery platform where you expect competition to intensify. But on current quick commerce platforms, how have the trends been in the last two / three months? Has competition continued to increase? Has it been stable? Has it reduced? Would love to see the dynamics between quick commerce versus next-day delivery and how is that moving in terms of competition? The competition has been in different shapes and forms coming from both players, who are already in the quick commerce space and the new playe

Q

Hi - so, two questions. So firstly, in terms of these new stores that you've added, can you give us a sense of how many have come in new cities and then just an extension of that, how many cities you are present in today? And second question is on Zomato Everyday. This was one attempt to address the affordability and sort of frequency it fuels, but it seems like you are shutting the business down. Can you give us a sense of what really didn't work out with that business? And is there another similar business or something along those lines that we are tracking? Maybe does Zomato Bistro fill in

Akshant Goyal

Aditya, we're not sharing the data on cities, etc., at this point. But yes, broadly, we are going into smaller cities every quarter. And incrementally, a larger portion of our new store expansion is happening in the non-top eight markets. Having said that, even in the top cities we are growing, but more and more share of new store openings is now going towards the smaller markets, where we are seeing equally good customer adoption of quick commerce. On Zomato Everyday, I won't say that it didn't work. For the markets we were in, the business was doing well, and we did see that it can make mone

Q

Hi everyone. Thanks for the opportunity. My first question is on quick commerce. So, one of your competitors seems to have mentioned that their GOV numbers include subscription fees and ad income. But your definition does not seem to include that. While I can understand why subscription fee may not be included in your numbers, but wanted to understand how do you report ad income? And what percentage of your take rate on GOV or maybe NOV, whichever way you want, will be coming from ad income and customer fees?

Akshant Goyal

Thanks, Swapnil. So yes, we don't include any of these ancillary income streams in our GOV definition or NOV definition. It's without that. And it's not just NOV, even GOV definition was without that, just to clarify. So that's how we report. And therefore, the ad income directly goes to our revenue. It's not part of the GOV definition. It's north of 4% of GOV today for us. Okay, that's great. On customer fees, the delivery fees and handling fees and other fees like that? Yes. About 3%. Yes Swapnil, that's part of GOV clearly. It's mentioned in the definition. Got it. Got it. And the second qu

Q

A few questions. Firstly, how do you guys look at your market share as your statement in the shareholder’s letter saying that we'll aggressively look to grow our market share in quick commerce. Are you able to maintain? Are you able to gain your market share basis your understanding in the last 1-2 quarters? Albinder Singh Dhindsa: Hi Sachin, so our understanding is that even with the new competition, we have more or less maintained our market share over the last few quarters. The competitive intensity has been fairly high, but at the very least, we've maintained it.

Sachin Salgaonkar

Got it. Second question, Blinkit clearly has a slight different approach in quick commerce as compared to the traditional quick commerce competitors. And I'm saying that because you guys don't have private labels. You don't have the super saver or the max saver equivalent of your competitors. Any particular reason why you guys are not doing it? Is it economics? Is it something else? Sachin, we don't think that from a customer perspective these use cases add a lot of value. And so, we don't do them. Got it. Third question, as you're expanding into tier 2 / tier 3 cities, how do you look at the

Q

Thank you for the opportunity. So Albinder, for you maybe on Blinkit. This quarter, I thought it was really interesting that contribution margin was maintained. The loss expansion is more to the adjusted levels. You kind of, moved the incentive spends, etc. right? Just reflecting your comments on competition for the next few quarters or maybe if I just expand it as well, in the face of competition, could we expect contribution margin to drop? Or should we expect contribution margin to be flat? Albinder Singh Dhindsa: Aditya, it's very difficult to say, as I mentioned in the letter also. See, o

Aditya Suresh

Got it. And just in terms of the prior state in the first half when you were at the breakeven position, would it be fair to say that we’ll be back on the path towards breakeven only once competition settles? Or do you see any other levers here to kind of pull to get us back on the trajectory even as competition is expanding? Aditya, there are too many moving parts here. And honestly, we're not thinking about our goals and targets in that form and shape. Just getting to breakeven is not enough anyway. So long term, we have to solve for much higher profitability than just that. And we are at -2%

Q

Hi, congrats on good execution. A couple of questions. On your comment on competition intensifying in quick commerce; so far, our investments were focused on growing network of stores, increasing assortment while not necessarily focusing a lot on subsidies. And now you have talked about growing market share aggressively. So, any change in priorities from investment point of view?

Akshant Goyal

No, Gaurav. No change in priorities. Even in the last quarter or the last two or three quarters since the time competition really started increasing, our approach has been fairly consistent in terms of the key focus areas we mentioned in our letter. So far, we haven't really seen any loss in business because of not being able to subsidize at the levels at which we are seeing the competition doing so in the market. So that's great news for us. And hence, I think we don’t need to course correct and just focus on what we are doing. Got it. Any color that we can get on your SSG growth in the top 8

Q

Hi, thank you. So, my first question is on food delivery. Now that you've shut down the Quick thing and one of the three growth vectors you've called out here is delivery timelines, as you know, one of the mechanisms to grow the food delivery business and the other was affordability, where you obviously shut down Everyday. So, specifically to the delivery timeline thing, what is the path to lowering that going forward in the medium term now that you think the Quick model didn't work?

Akshant Goyal

Yes, Vijit, so Quick was an attempt to bring down the delivery time from the average, let's say, 30 minutes for the platform to 10 minutes. What we've realized is that it is extremely hard, and we don't see any incrementality in demand if we do that in the business given that customer experience is poor. But of course, there's a wide range between 10 and 30 minutes. So, our view is that we should try and bring that 30 minutes down to maybe 20- 25 minutes over time by making our overall logistic fleet delivery system more efficient. And those are the gains we want to chase now rather than tryin

Q

Alright, thank you. Just the first question on quick commerce, maybe a follow-up to the last question. Hyperpure is currently doing some of the non-restaurant business for Blinkit. Could you maybe highlight what is the level of working capital that's currently being deployed there?

Akshant Goyal

We don't share that data, Ankur. It's different for different sellers, for different products. So yes, we don't disclose that data. Okay. In the quick commerce business, the MTC growth was quite nice, but you've referenced the competition a lot in the letter and in this call. Are you seeing any kind of loss of customer wallet share in existing areas where store density is going up because of competition? Albinder Singh Dhindsa: Not yet, Ankur. Okay. In terms of the NOV to GOV ratio, I noticed there was a slight uptake this quarter. Is that just seasonality? Or is that moderating subsidies in t

Q

Hi, thank you for this. Just a couple of questions. So, there are already three quick commerce players of reasonable size and scale and a couple of horizontals, like you mentioned also entering. So, from your perspective, given these are platform businesses with some sort of network effect, how many such players can potentially exist in the market like, say, in the medium term and not in the near term for sure, but at least in the medium term?

Akshant Goyal

We are worried about our own existence (laughs). Albinder Singh Dhindsa: Gaurav, I don't think anybody has an answer to that. Got it. Got it. And in terms of given the kind of expansion which you are doing and obviously, which the other players are also doing in terms of store expansion within the cities, outside new cities; and this all expansion is coming at a time when there is generally these subsidies being offered. So, how much of a demand over-estimation you think is happening over here? There would be some bit, but any sense there? Is that a worry for you guys? Albinder Singh Dhindsa:

Q

Hi. So yes, first of all, congrats on a robust set of numbers under these circumstances. So, I have a few questions. You've spoken about competitive intensity impacting your costs. So, can you give us some idea of how much your last mile delivery costs have gone up YoY?

Akshant Goyal

Sorry, Abhisek, we can't share these details, these are like nuts and bolts of the business and competitively sensitive. Sure. You also spoke about your marketing spends going up. So, can you give some sense on what you spent on? Was it more performance marketing based or BTL/ATL? Albinder Singh Dhindsa: Across the board, Abhisek. Okay. One of the things that I saw that your other income has gone up, but your taxation has actually come down. And you have given an explanation for that. You've talked about some unabsorbed depreciation, which was set off here. But that has given you a very signif