Indian Mutual Funds Double Down On Eternal Amid FII Selling Spree

Domestic mutual funds sharply increased their bets on Zomato parent Eternal in the Q4 FY26, as foreign investors pulled back significantly.

Data from the company’s stock exchange filings show that mutual fund ownership in the company jumped to 28.9% in March 2026 from 16.4% in December 2025.

The buying was broad-based. Large domestic funds such as SBI Mutual Fund and HDFC Mutual Fund built sizable positions, each crossing the 3.5% mark. SBI Nifty 50 ETF’s holding stood at 3.54% while HDFC Flexi Cap Fund’s at 3.53%. 

New entrants, including Mirae Asset (1.42%), Motilal Oswal (1.77%) and Aditya Birla Sun Life (1.27%), also added fresh exposure. 

Meanwhile, existing investors scaled up meaningfully. Kotak Flexicap Fund increased its holding from 1.63% to 2.68%, ICICI Prudential Balanced Advantage Fund from 1.75% to 2.64%, UTI Flexi Cap Fund from 1.31% to 2.15%, and Nippon India’s exposure rose from 1.02% to 2.03%.

At the same time, foreign investors moved in the opposite direction.

Total foreign ownership in Eternal dropped to 32.6% from 47.3%. The biggest drag came from foreign portfolio investors (FPIs), whose holdings fell 11.2% to 24.8% during the quarter under review, led by a broad-based reduction across over a thousand smaller investors.

Among notable moves, Kuwait Investment Authority and Antfin Singapore exited their entire stakes. The Government of Singapore trimmed its exposure slightly to 1.11% from 1.37%. On the other hand, Temasek-linked entities, Camas Investments and Dunearn Investments, maintained their positions, while DF International Partners emerged as a new investor with a 1.5% stake.

This shift suggests a clear handover in ownership from foreign capital to domestic institutions, which is a wider trend currently in the country. Notably, ever since the US-Iran war started, foreign institutional investors (FIIs) have pulled out over $18 Bn (about ₹1.68 Lakh Cr)  from equities, including more than $13.9 Bn (about ₹1.30 Lakh Cr) in March alone, as rising oil prices and geopolitical uncertainty fuelled a strong risk-off sentiment. 

While FPIs have been reducing exposure, domestic mutual funds, along with insurance and pension funds, have absorbed most of the selling. Mutual funds alone added over 12 percentage points during the period, effectively offsetting the foreign outflows.

Notably, Info Edge (India) continues to hold over 12% in the company, while Deepinder Goyal increased his stake from 3.83% to 4.40%.

Indian MFs Increase Exposure After A Strong Q3

This ownership shift is also playing out alongside a period of sharp financial expansion and strategic churn at Eternal.

In Q3 FY26, the company reported a 73% YoY jump in net profit to ₹102 Cr, even as revenue surged over 3X to ₹16,315 Cr, largely driven by Blinkit’s transition to an inventory-led model. 

The shift in Blinkit’s model has materially altered Eternal’s financial profile. At the segment level, Blinkit has clearly emerged as the primary growth engine. The business crossed ₹10,000 Cr in quarterly revenue and turned adjusted EBITDA positive for the first time, supported by supply chain efficiencies and operating leverage.

Eternal continues to double down on this vertical, having infused ₹450 Cr into Blinkit in early 2026, following ₹2,600 Cr of investments in 2025, as it aggressively scales dark store infrastructure amid intense competition.

At the same time, the core food delivery business under Zomato remains the primary profit driver, delivering steady growth with a 29% YoY rise in revenue and strong operating profitability. 

Emerging bets such as District and Bistro, however, continue to weigh on near-term margins due to upfront investments, though management expects to break even in the coming quarters.

Meanwhile, on the leadership front, Deepinder Goyal has stepped down as CEO, with Blinkit CEO Albinder Dhindsa set to take over the broader business.

Shares of Eternal ended 4.36% higher at ₹246.5 on the BSE today.

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