ETERNAL

“It's hard to project or comment on margin trajectory every quarter but broadly, over the next 1 or 2 years, we expect the margins to remain flattish.”

“What we are saying here is that as we accelerate store addition, which is starting OND, we don't expect that to hit the margins in the short term. Longer term, of course, margins will continue expanding”

“They're not very meaningful at this stage, and we don't expect the capex or cost to become meaningful, at least as of now, unless, of course, we receive a blockbuster response to this product.”

“That will be largely hardware and compute. Those are the investments we will need here, which we are already doing, since we've been running it on a pilot for the last few months internally within Zomato.”

“Directionally, we've also mentioned in the letter that the bulk of the expansion of these new stores will be in smaller cities. We do expect that to be the focus from here on, and we are seeing great outcomes in terms of payback on these stores in these markets that we've expanded into in the last few quarters.”

“What we have seen so far is that the economics are pretty robust. Paybacks are extremely good in these markets. The other point is also true that these markets are less competitive”

“What we're trying to do here is expand the market and expand the growth for the business, which eventually leads to higher growth on absolute Adjusted EBITDA profits. That's what we're trying to solve for, not the percentage margin.”

“It is reducing directionally.”

“Vijit, we’ve expanded gourmet to Bangalore and Bombay as well.”

“But as the overall assortment converges, both these numbers tend to converge.”

“Generally, the competitive intensity last quarter in food delivery was higher compared to the previous few quarters, and partly also driven by Zomato.”

“Gaurav, it's very early, and we want to learn and experiment. In any case, in India, agentic commerce adoption is close to zero.”

“It doesn't make sense to us at all either and we are equally surprised.”

“But now, as we mentioned last time also, competition is more predictable now, and that provides an opportunity for us to become more aggressive on infrastructure expansion.”

“For example, in our mature cities, Blinkit MTU is already multiple times that of Zomato, and we don't see any plateau there yet.”

“In both new customer acquisition as well as in driving frequency of our existing customer base, we have increased the amount of investments we have done consistently over the last few quarters, and that trend is likely to continue.”

“For example, technology server costs are below contribution. So, as the business scales, those costs will go up. And some of those costs are priced in dollars, so the exchange rate also doesn’t help there.”

“Broadly, what we should look at is the overall Adjusted EBITDA margin, and a lot of the improvement we see there is on account of operating leverage. Till the time we continue expanding, that is what will drive most of the margin expansion.”

“There are various factors at play, and there won't be a linear correlation between NOV per store going up and contribution.”

“Most of the offset for the NAOV is assortment expansion in tier 1 cities, which leads to higher NAOVs in tier 1, and that balances out some of the lower NAOVs from tier 2 cities.”

“Look, we already sell air conditioners, and you can't keep just one week of inventory for air conditioners. So obviously, the holding period is much longer for those products, and we are comfortable doing that.”

“On your other question, this product has been in the works for about a year, and it's not monetized yet, so all the costs here are accounted for in our ‘Others’ segment.”

“We are still a few months away from launch, so we'll see how the go-to-market is. But long term, it's a product open for all.”

“If it works, it will become really big; it's more like a zero-to-one bet at this point. If it works, it's a global business and it will generate extremely high shareholder value over the next few years. But if it doesn't work, it's something we'll kill.”

“We expect the next 12 months to tell us whether any of this will become meaningful.”

“These are all businesses where any of them, if they scale, is going to deliver a multibillion-dollar market cap outcome.”

“As a base case, we think this could be a high gross margin business, which could fund itself largely and get to profitability pretty soon.”

“So far, we don't even have a plan to figure out how to block them if we need to.”

“And the good thing is that we have the balance sheet to invest, if required, into building these businesses, as long as they demonstrate a longer-term return on capital.”

“For example, as we mentioned in the letter, private labels in quick commerce is not something that we think we have competence in, so we're choosing not to do that.”

“The current AI bot that you see, we are seeing some traction there. But we are iterating on it, so you will see a much better product in the coming weeks and months.”