April 28 (Reuters) - Indian online delivery firm Eternal posted better-than-expected quarterly profit on Tuesday, supported by continued expansion in its quick-commerce business and steady growth in its core food delivery unit.
The company reported a consolidated net profit of 1.74 billion rupees ($18.40 million) for the quarter ended March, above analysts' estimates of 1.21 billion rupees, per data compiled by LSEG.
Eternal's quick commerce arm Blinkit - which delivers everything from groceries to electronics within minutes - was a key growth driver, driven by store additions, wider product assortment and expanding geographic coverage. The company added 216 Blinkit stores in the quarter, taking the total to 2,243.
India's fast-growing quick-commerce market also includes players such as Swiggy's Instamart and Zepto. Conglomerates such as Reliance and global players Amazon and Walmart-backed Flipkart are also vying for a share of the growing market.
Margins at both Eternal's food delivery business Zomato and at Blinkit improved during the quarter, the company said. Growth in food delivery was supported by a lower minimum order value threshold to qualify for free delivery for its Gold-subscribing customers, it added.
Food delivery net order value grew 18.8% year-on-year, improving for the third straight quarter and getting closer to the firm's long-term target of more than 20% annual growth.
"Revenue per order continues to improve and operating cost efficiencies have kept pace, which is why margins have remained stable even as the order mix has shifted towards lower-value orders", the company said.
The company's shares pared losses of as much as 4% after the results to close 0.95% lower in Mumbai trade.
Eternal's revenue from operations rose almost three-fold year-on-year to 172.92 billion rupees, missing analysts' expectations of 182.81 billion rupees, according to LSEG data.
Reporting by Surbhi Misra in Bengaluru; Editing by Ronojoy Mazumdar
($1 = 94.5450 Indian rupees)
Source: Reuters