Eternal Limited’s Chief Financial Officer Akshant Goyal said that the recent Goods and Services Tax (GST) rate reductions have had a dual impact on the company’s operations — a short-term slowdown in Q2FY26, but a positive demand outlook starting from Q3FY26 onwards.
According to Goyal, the average GST on Blinkit’s typical basket fell by nearly 3 percentage points, a change expected to stimulate consumer demand in the upcoming quarter. “The rate cuts came into effect only towards the end of Q2FY26, but we expect a positive rub-off on demand from Q3FY26 onwards,” he stated.
However, during the second quarter, Eternal experienced a temporary dip in growth and margins, as customers adopted a “wait and watch” approach, delaying purchases across several product categories — even those not directly impacted by the tax change.
Goyal also highlighted a separate change affecting the company’s food delivery business: an 18% GST is now applicable on delivery charges paid by customers. This affects roughly 25% of food delivery orders, where delivery is not complimentary. Eternal has passed this tax on to consumers, slightly dampening order growth in that segment.
In contrast, Blinkit remains unaffected, as its delivery charges already included 18% GST under its existing model of engagement with delivery partners. “Nothing changes for us on that front,” Goyal clarified.
Overall, Eternal expects the GST rate cut to serve as a tailwind for Blinkit’s demand from Q3FY26, helping drive higher order frequency and customer retention as affordability improves.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions.
