Bernstein Bullish on Zomato, Amid Quick-Commerce Boom

Bernstein Bullish on Zomato Despite Rising Quick-Commerce Competition, Sees Potential Rally to ₹310
Global brokerage firm Bernstein has reaffirmed its bullish stance on Zomato Ltd., despite the rising competition in the quick-commerce space. The firm has maintained its ‘outperform’ rating on the stock, setting a target price above current market price, indicating a potential upside of nearly 39% from current levels.

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Zomato’s Position in the Quick-Commerce Race

The quick-commerce sector has been a key battleground with major players like Zomato, Swiggy, and Zepto aggressively expanding their reach and marketing efforts. Bernstein acknowledges this heightened competition but believes the landscape has shifted compared to the pre-IPO period. While rapid growth remains a focus, the brokerage asserts that companies, including Zomato, are now prioritizing medium-term profitability rather than engaging in extreme price wars.

Bernstein also highlighted that Swiggy’s lower-margin structure places a natural cap on how intense the pricing battle can get. This, in turn, could benefit Zomato, as it continues to strengthen its leadership in the segment while maintaining a balance between expansion and financial sustainability.

Market Performance and Analyst Insights

As of 9:16 AM, Zomato share price were trading at ₹226.15 on the NSE, marking a 1% gain. The stock has been under focus following its inclusion in the benchmark Nifty 50 index, as part of NSE’s March rebalancing, alongside Jio Financial Services.

Bernstein has previously advised investors to focus on ‘winners’ in 2025, with stock selections driven by an IT earnings upgrade cycle, strong macroeconomic trends in the US, and a revival in discretionary and generative AI-driven spending. Within the internet sector, the firm believes quick commerce will outpace traditional retail channels, largely driven by category expansions and increased penetration into Tier 2 cities. Zomato is expected to be the biggest beneficiary of this trend.

Beyond Food Delivery: Zomato’s Rebranding to Eternal

In a major strategic move, Zomato recently announced its rebranding to Eternal, a decision approved by its board on February 6. The company explained that the name change reflects its ambition to expand beyond its core food delivery business and establish a broader presence in various digital commerce sectors.

Initially, quick commerce was thought to cater mainly to high-end consumers in metro cities. However, Bernstein notes that the sector has witnessed a wider adoption across diverse consumer segments, extending beyond affluent urban users. With Zomato at the forefront of this transformation, analysts remain optimistic about its long-term growth potential.

Conclusion

Despite intensifying competition in the quick-commerce space, Bernstein remains confident in Zomato’s ability to navigate challenges and sustain profitability. The brokerage’s target price above market price suggests significant upside, making Zomato an attractive investment amid evolving consumer preferences and digital expansion strategies. With its inclusion in Nifty 50 and a broader vision through its rebranding, Zomato (now Eternal) appears well-positioned to capitalize on the booming quick-commerce market.