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Economic Times
9 hours ago
- Business
- Economic Times
Most expensive Nifty stock ever? Eternal at 455 PE dares you to doubt the hype
Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel If something is good enough, it would probably be expensive. But at 455 times earnings, Eternal isn't just expensive but in a valuation galaxy of its own. The Nifty 50's newest entrant is also its most richly valued stock, wearing a PE multiple that makes seasoned value investors squirm and growth investors think blame only Eternal. Two other Nifty constituents, Trent (132x PE) and Jio Financial (113x PE), are also sitting pretty above the 100x valuation mark, signaling a shift in investor appetite towards long-term growth over current the opposite end of the spectrum? Coal India , the public sector behemoth, trades at a humble PE of 6.8x, giving Nifty watchers a vivid picture of the valuation extremes in India's top 50 listed companies.A trailing 12-month (TTM) PE of 455 means investors are paying today for profits the company may earn over the next four and a half centuries, if earnings stood still. But theory rarely captures the speed at which some Indian digital-first companies are expanding. Eternal, formerly known as Zomato, is thriving in two of India's hottest consumer tech battlegrounds: food delivery and quick investor worries and growing competitive heat, the stock is anything but funds have been lining up for a bite of Eternal. In May alone, they pumped in ₹5,300 crore, making it the third-most bought stock that month, according to estimates by Prime this month, Morgan Stanley reiterated Eternal as its top India internet pick, citing its market leadership in both food delivery and quick commerce, a superior cost structure, and a balance sheet stronger than its peers. The firm has a target price of ₹320 on the Eternal shares are down 10% year-to-date, the Street isn't writing it off. Concerns loom large. Rapido's entry into food delivery, intensifying competition from Zepto, BigBasket, Swiggy Instamart, Amazon Now, and Flipkart Minutes in the quick-commerce race but believers say the company's edge lies in Securities' Sachin Salgaonkar returned from a recent internet tour upbeat on Eternal's quick commerce arm Blinkit:'Traction in Tier 2 cities surprised industry experts… some stores hit 1,000 orders per day within 6–9 weeks. Amongst the top platforms, only Zomato continues to add more dark stores while others like Swiggy/Zepto/BigBasket have started to slow down store adds.'That expansion drive, Salgaonkar believes, gives Blinkit a competitive edge, especially as rivals slow store additions. Interestingly, the real kicker isn't convenience or discounts but better product selection, especially in smaller Securities, too, maintains a Buy rating, valuing Eternal at ₹310 via a three-stage DCF model. The brokerage sees signs of softening pricing wars, noting that Instamart and Zepto have reduced the pricing gap with Blinkit. The end of the discount era may be in sight—a potential profitability Jefferies, Eternal is a long-term bet on the digitization of food services. 'With only ~20 million monthly transacting users currently, there's a long runway for growth. Blinkit is already the market leader in quick commerce and is poised for sharp margin improvement.'Palak Shah, VP, PL Capital, adds perspective from the institutional front: 'Markets focus on the total addressable market and execution capability. Eternal has proven itself in food delivery. The belief is now that they can replicate that in quick commerce. Once the capex phase is over, operational efficiency will drive the narrative.'Yet, competition is getting bolder. Rapido's attempt to disrupt the food delivery space by lowering commission rates is leading to speculation that the Gross Order Value (GOV) may start shifting from Sonthalia, CIO at Emkay Investment Managers, argues that while the entry barriers are low, fixing unit economics is extremely difficult. 'Just entering and playing the pricing game doesn't guarantee success. Execution capability is crucial. Yes, competition is increasing, but the 'right to win' currently lies with only one dominant player. Others are still evolving. New entrants will have to work really hard.'Eternal may just be the poster child for investors who bet on the future, even when the present valuation feels like a cliffhanger. For now, the 455x question remains: Is the market's faith eternal or just euphoric?: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Time of India
9 hours ago
- Business
- Time of India
Most expensive Nifty stock ever? Eternal at 455 PE dares you to doubt the hype
If something is good enough, it would probably be expensive. But at 455 times earnings, Eternal isn't just expensive but in a valuation galaxy of its own. The Nifty 50's newest entrant is also its most richly valued stock, wearing a PE multiple that makes seasoned value investors squirm and growth investors think twice. Don't blame only Eternal. Two other Nifty constituents, Trent (132x PE) and Jio Financial (113x PE), are also sitting pretty above the 100x valuation mark, signaling a shift in investor appetite towards long-term growth over current profits. On the opposite end of the spectrum? Coal India , the public sector behemoth, trades at a humble PE of 6.8x, giving Nifty watchers a vivid picture of the valuation extremes in India's top 50 listed companies. A trailing 12-month (TTM) PE of 455 means investors are paying today for profits the company may earn over the next four and a half centuries, if earnings stood still. But theory rarely captures the speed at which some Indian digital-first companies are expanding. Eternal, formerly known as Zomato , is thriving in two of India's hottest consumer tech battlegrounds: food delivery and quick commerce . Despite investor worries and growing competitive heat, the stock is anything but untouchable. Mutual funds have been lining up for a bite of Eternal. In May alone, they pumped in ₹5,300 crore, making it the third-most bought stock that month, according to estimates by Prime Database. Also Read | Buy Eternal & Swiggy, sell Nykaa & BSE: Latest investing mantra of mutual funds Earlier this month, Morgan Stanley reiterated Eternal as its top India internet pick, citing its market leadership in both food delivery and quick commerce, a superior cost structure, and a balance sheet stronger than its peers. The firm has a target price of ₹320 on the stock. While Eternal shares are down 10% year-to-date, the Street isn't writing it off. Concerns loom large. Rapido 's entry into food delivery, intensifying competition from Zepto, BigBasket, Swiggy Instamart, Amazon Now, and Flipkart Minutes in the quick-commerce race but believers say the company's edge lies in execution. BofA Securities' Sachin Salgaonkar returned from a recent internet tour upbeat on Eternal's quick commerce arm Blinkit: 'Traction in Tier 2 cities surprised industry experts… some stores hit 1,000 orders per day within 6–9 weeks. Amongst the top platforms, only Zomato continues to add more dark stores while others like Swiggy/Zepto/BigBasket have started to slow down store adds.' That expansion drive, Salgaonkar believes, gives Blinkit a competitive edge, especially as rivals slow store additions. Interestingly, the real kicker isn't convenience or discounts but better product selection, especially in smaller cities. ICICI Securities, too, maintains a Buy rating, valuing Eternal at ₹310 via a three-stage DCF model. The brokerage sees signs of softening pricing wars, noting that Instamart and Zepto have reduced the pricing gap with Blinkit. The end of the discount era may be in sight—a potential profitability trigger. For Jefferies, Eternal is a long-term bet on the digitization of food services. 'With only ~20 million monthly transacting users currently, there's a long runway for growth. Blinkit is already the market leader in quick commerce and is poised for sharp margin improvement.' Palak Shah, VP, PL Capital, adds perspective from the institutional front: 'Markets focus on the total addressable market and execution capability. Eternal has proven itself in food delivery. The belief is now that they can replicate that in quick commerce. Once the capex phase is over, operational efficiency will drive the narrative.' Also Read | Rapido crashes food delivery party. Should Swiggy and Eternal investors be worried? Yet, competition is getting bolder. Rapido's attempt to disrupt the food delivery space by lowering commission rates is leading to speculation that the Gross Order Value (GOV) may start shifting from Zomato. Manish Sonthalia, CIO at Emkay Investment Managers, argues that while the entry barriers are low, fixing unit economics is extremely difficult. 'Just entering and playing the pricing game doesn't guarantee success. Execution capability is crucial. Yes, competition is increasing, but the 'right to win' currently lies with only one dominant player. Others are still evolving. New entrants will have to work really hard.' Eternal may just be the poster child for investors who bet on the future, even when the present valuation feels like a cliffhanger. For now, the 455x question remains: Is the market's faith eternal or just euphoric? ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Time of India
11 hours ago
- Business
- Time of India
Amazon to invest over Rs 2k crore in India this year to boost infra
Amazon is set to inject $233 million into its Indian operations this year, aiming to bolster infrastructure and enhance delivery speeds. This investment will also fuel the development of new technologies for its fulfillment network. MUMBAI: Amazon will invest $233 million (over Rs 2,000 crore) in India this year to expand and upgrade the company's operations infrastructure in the country. Portions of the capital will also be deployed to build new tools and technology for the firm's fulfilment network as the Seattle-based e-commerce company takes on deep-pocketed startups Zepto, Zomato, and Swiggy in the cash-guzzling quick commerce space. "This new investment builds on top of Amazon's investments in creating an ops network that helps the company deliver to all serviceable pin codes across India. This investment will enhance processing capacity, improve fulfilment speed, and increase efficiency across the company's operations network that will help Amazon serve customers across India faster," the firm said in a statement on Thursday. For Amazon, which entered India twelve years ago and was largely operating in a two-player e-commerce market alongside Walmart-controlled Flipkart for a good few years, competition has now grown. Startups such as Meesho, backed by storied investors like SoftBank, are foraying into the market and carving a space of their own by targeting a whole new set of customers who were underserved. Conglomerates such as Reliance Industries and Tata Group are also investing in e-commerce. Besides, startups Swiggy, Zepto, and Zomato's Blinkit have created a growing market for 10-minute deliveries in India, a new challenge for Amazon, which was late to enter the quick commerce space. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
a day ago
- Business
- Time of India
Amazon to invest $233 million in India to expand operations infra
MUMBAI: Amazon will invest $233 million (over Rs 2,000 crore) in India this year to expand and upgrade the company's operations infrastructure in the country. Portions of the capital will also be deployed to build new tools and technology for the firm's fulfilment network as the Seattle-based e-commerce company takes on deep-pocketed startups Zepto, Zomato and Swiggy in the cash guzzling quick commerce space. 'This new investment builds on top of Amazon's investments in creating an ops network that helps the company deliver to all serviceable pin-codes across India. This investment will enhance processing capacity, improve fulfilment speed and increase efficiency across the company's operations network that will help Amazon serve customers across India faster,' the firm said in a statement on Thursday. For Amazon which entered India twelve years back and was largely operating in a two-player e-commerce market alongside Walmart controlled Flipkart for a good few years, competition has now grown with startups such as Meesho backed by storied investors like SoftBank foraying into the market and carving a space of its own by targeting a whole new set of customers who were underserved. Big conglomerates such as Reliance Industries and The Tata Group are also investing in e-commerce. Besides, startups Swiggy, Zepto and Zomato's Blinkit have created a growing market for 10-minute deliveries in India, a new challenge for Amazon which has been late to enter the quick commerce space. As more Indians become tech savvy and move online to shop for everything ranging from groceries to apparel, companies are sharpening strategies to stay ahead of the game. Amazon plans to take its India investment to $26 billion by 2030. 'By strengthening our infrastructure capabilities….we're positioning Amazon to better serve customers throughout India,' said Abhinav Singh, VP, operations at Amazon India and Australia. Amazon will also expand initiatives for improving the health and financial well-being of employees and associates across the operations network. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
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Business Standard
3 days ago
- Business
- Business Standard
Zepto scales fresh supply chain, sells 22 lakh units daily in May
Quick commerce platform Zepto has scaled its fresh produce category, which comprises fruits and vegetables, fourfold in a year. The company sold 22.1 lakh units of produce per day in May this year, compared to 6.4 lakh units sold per day in the corresponding period last year, the co-founder and chief executive of the platform said in a post on LinkedIn. 'Last month, Zepto's supply chain team hit a huge milestone — 22 lakh units of fruits and vegetables sold per day (up from 6.4 lakh last year)! This volume represents one of the largest and most sophisticated fresh supply chains in the country today,' Palicha wrote. According to the company, a few long-standing challenges in the retail of fresh produce include the overpresence of intermediaries, unpredictable pricing and poor quality produce. However, the company said it could scale because it now works directly with farmers across more than 70 collection centres where produce is graded, packed and dispatched. 'Zepto has achieved this scale through direct sourcing, tech-led procurement and smart last-mile handling — making fresh produce not just faster, but more accessible and affordable. Zepto works directly with thousands of farmers across 70+ collection centres — strategically located hubs where produce is graded, packed and dispatched within 12 hours of harvest,' the company said in a statement. Sharing the vision for the future, Palicha said fruits and vegetables are the largest category of consumption in the country, and the company aims to build a world-class supply chain at a larger scale over the next 10 years. Zepto's Bloom app, a proprietary sourcing intelligence platform, offers real-time mandi price benchmarks, automated vendor scoring and dynamic procurement planning. 'This gives farmers transparency, better pricing power and predictability, all of which were missing in the traditional mandi system,' the company said.
