Eternal spent ₹1,138 crore on advertising and sales promotion during the second quarter of FY2026–27, a 41% increase from ₹806 crore in the corresponding quarter last year. The increase reflects the growing importance of marketing, promotional offers and customer acquisition as the parent company of Zomato, Blinkit and District competes for consumers across food delivery, quick commerce and entertainment.
The spending increase came as Eternal reported a 77.6% year-on-year rise in revenue from operations to ₹24,138 crore for the quarter ended September 30, 2026. Consolidated net profit climbed 92.3% to ₹125 crore, although it fell short of analyst expectations. Blinkit’s rapid expansion and growing competition for customers have made promotional spending an important part of Eternal’s strategy, but they also raise questions about the cost of sustaining growth.
Key Takeaways
- Marketing and promotional expenses: Rose 41% year-on-year to ₹1,138 crore in Q2 FY27.
- Year-ago comparison: Eternal spent ₹806 crore on the same expense category in Q2 FY26.
- Quarter-on-quarter growth: Spending increased from ₹936 crore in Q1 FY27 to ₹1,138 crore in Q2 FY27.
- Revenue growth: Consolidated revenue from operations increased 77.6% to ₹24,138 crore.
- Net profit: Rose 92.3% year-on-year to ₹125 crore.
- Blinkit expansion: The quick-commerce business continued investing in its store network and customer growth.
- Important distinction: The expense category includes more than advertising, covering certain subsidies, customer appeasement costs and refunds.
Eternal Advertising Expenses: Quarterly Comparison
Eternal’s advertising and sales promotion expenses have increased as its consumer-facing businesses expand and compete for market share.
| Financial metric | Q2 FY26 | Q1 FY27 | Q2 FY27 |
|---|---|---|---|
| Advertising and sales promotion expenses | ₹806 crore | ₹936 crore | ₹1,138 crore |
| Year-on-year change | — | — | +41% |
| Quarter-on-quarter change | — | — | +21.6% |
Source: Eternal’s reported financial results. Figures are rounded.
The company spent ₹332 crore more on advertising and sales promotion in Q2 FY27 than in the year-ago quarter. Compared with Q1 FY27, the increase was ₹202 crore.
The sequential rise suggests that spending intensified during the September quarter. However, the expense line should not be interpreted as advertising expenditure alone: it also includes certain customer incentives and other promotional costs.
These expenses can support customer acquisition and retention, but their effectiveness depends on whether the resulting orders, bookings and repeat purchases generate sufficient contribution to justify the spending.
What Is Included in Eternal’s Advertising and Sales Promotion Expenses?
The accounting category covers several types of expenditure across Eternal’s businesses. It includes platform-funded subsidies to the extent they are not netted against revenue, marketing and branding costs, customer appeasement expenses and refunds.
This distinction matters because the headline figure is broader than conventional advertising budgets.
| Expense component | Business purpose |
|---|---|
| Marketing and branding | Build awareness and strengthen brand recognition |
| Platform-funded subsidies | Make selected orders more attractive through incentives |
| Customer acquisition campaigns | Encourage new users to try a service |
| Promotional offers | Encourage purchases and repeat transactions |
| Customer appeasement costs | Address selected customer-service issues |
| Refunds | Return money to customers in qualifying cases |
Not every rupee in this category is necessarily spent on acquiring a new customer. Some expenditure supports retention, customer service or transaction-related adjustments.
For investors, understanding this composition is important when evaluating whether higher promotional spending is translating into sustainable growth.
Why Blinkit Is a Major Part of the Growth Strategy
Blinkit has been expanding its quick-commerce network as demand grows for rapid delivery of groceries, household essentials and other products.
Quick-commerce platforms compete on assortment, availability, convenience, delivery speed and price. Promotional offers can encourage customers to try a platform, switch from a competitor or increase the size of their baskets.
Eternal added 308 Blinkit stores during Q2 FY27, bringing its total network to 2,751 stores at the end of September. The company aims to exceed 3,500 stores by March 2027 and has outlined a longer-term ambition to reach approximately 5,000 stores by March 2028.
Expanding the network can improve geographical coverage and make rapid delivery available to more customers. It also increases the importance of demand generation: newly opened stores need enough order volume to use their capacity efficiently.
Marketing and promotions can help generate that demand, but the economic benefits depend on how much business is incremental and how many customers continue ordering after incentives are reduced.
Zomato and District Also Need Customer Engagement
Eternal’s spending supports a broader portfolio rather than Blinkit alone.
Zomato competes in food delivery, where restaurants, delivery platforms and rival services vie for customer attention. Discounts, targeted promotions and loyalty-related incentives can influence where consumers place orders, although excessive reliance on discounts can pressure margins.
District operates in going-out categories, including events and entertainment. Customer acquisition and engagement can be particularly important when the platform introduces new offerings or tries to increase bookings.
The challenge across all three businesses is to balance growth with spending discipline. Marketing can increase visibility and transaction volumes, but the company must assess whether the additional business produces adequate returns after incentives, fulfilment costs and other expenses.
Revenue Is Growing Faster Than Promotional Expenses
Eternal’s Q2 FY27 results show that revenue growth outpaced the increase in its advertising and sales promotion expense line.
| Metric | Q2 FY26 | Q2 FY27 | Year-on-year change |
|---|---|---|---|
| Revenue from operations | ₹13,590 crore | ₹24,138 crore | +77.6% |
| Advertising and sales promotion expenses | ₹806 crore | ₹1,138 crore | +41% |
| Consolidated net profit | ₹65 crore | ₹125 crore | +92.3% |
The comparison suggests that the company expanded revenue substantially while increasing this particular expense category at a slower rate. However, it would be incorrect to conclude that marketing efficiency necessarily improved on this evidence alone.
Revenue growth also reflects order volumes, product mix, store expansion and other factors. A full assessment would require segment-level marketing data, customer acquisition costs, repeat-purchase rates and the contribution generated by promotional campaigns.
Eternal’s total expenses also increased sharply as the company expanded its operations. Investors must therefore consider the complete cost structure rather than looking at advertising expenditure in isolation.
What the Spending Means for Profitability
Higher marketing spending is not automatically negative. Companies often invest aggressively when entering new markets, expanding distribution or building customer habits. If the investment generates recurring transactions and customers remain active after promotional offers end, it can support long-term profitability.
The risk is that customer growth becomes dependent on repeated discounts. In that situation, a platform may need to keep spending heavily just to maintain order volumes, limiting the benefit of scale.
For Eternal, important indicators include order growth, average order values, customer retention, contribution margins and the profitability of individual businesses.
Blinkit’s expansion adds another layer to the calculation. New stores require investment and take time to build demand. Marketing can accelerate adoption, but the long-term return depends on whether each location can generate sufficient sales and operating earnings.
The company will need to demonstrate that customer acquisition spending is supporting durable demand rather than merely shifting orders between competing platforms.
The Bigger Picture
Eternal’s rising advertising and sales promotion expenses illustrate the intensity of competition in India’s consumer internet market. Food delivery, quick commerce and entertainment platforms are all trying to attract customers, increase engagement and build repeat usage. As these businesses expand, spending on promotions and customer acquisition can become a significant part of their operating strategy.
The critical issue is not whether marketing expenditure rises, but whether it creates lasting value. Eternal’s revenue and profit grew strongly in Q2 FY27, yet the company must continue balancing expansion with operating costs and the economics of each transaction. Future results will reveal whether its promotional investments are producing sustainable growth and stronger profitability.
FAQs
1. How much did Eternal spend on advertising and sales promotion in Q2 FY27?
Eternal reported ₹1,138 crore in advertising and sales promotion expenses for Q2 FY27, up 41% from ₹806 crore in Q2 FY26.
2. Why are Eternal’s promotional expenses increasing?
The increase comes amid competition and expansion across Blinkit, Zomato and District. Marketing, subsidies and customer incentives can help attract users, encourage purchases and support repeat transactions.
3. Does the ₹1,138 crore figure represent advertising alone?
No. The reported category also includes certain platform-funded subsidies, customer appeasement expenses and refunds, in addition to marketing and branding costs.
4. Did Eternal’s profit grow alongside its promotional spending?
Yes. Consolidated net profit rose 92.3% year-on-year to ₹125 crore in Q2 FY27, while revenue from operations increased 77.6% to ₹24,138 crore. Profit nevertheless fell short of analyst expectations, and the overall impact of marketing on profitability cannot be assessed from these figures alone.
Looking Ahead
Investors will watch Eternal’s next quarterly results for changes in promotional spending, customer demand and profitability across its businesses. Blinkit’s store expansion, order growth and adjusted EBITDA will be particularly important in determining whether customer acquisition investments are translating into stronger operating performance.
The longer-term test is whether Eternal can build repeat customer behaviour without relying excessively on discounts and incentives. If marketing spending supports sustainable demand and improves the economics of each transaction, it could strengthen the company’s competitive position. If promotional costs continue rising without comparable improvements in customer retention and contribution margins, the pressure on profitability could persist.
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