Eternal Ltd (NSE: ETERNAL) Q4 2026 Earnings Call dated Apr. 28, 2026
Corporate Participants:
Akshant Goyal — Chief Financial Officer
Albinder Singh Dhindsa — Founder & Chief Executive Officer
Kunal Swarup — Head, Corporate Development
Analysts:
Gaurav Malhotra — Analyst
Manish Adukia — Analyst
Aditya Soman — Analyst
Ankur Rudra — Analyst
Abhisek Banerjee — Analyst
Swapnil Potdukhe — Analyst
Ashwin Mehta — Analyst
Jignanshu Gor — Analyst
Gaurav Rateria — Analyst
Garima Mishra — Analyst
Rishi Jhunjhunwala — Analyst
Vijit Jain — Analyst
Sachin Salgaonkar — Analyst
Presentation:
Operator
Ladies and gentlemen, a very good evening and welcome to Eternal Limited’s Q4FY26 earnings conference call from Eternals management team. We have with us today Akshan Goyal, Alvinder Singh Dinsa and Kunal Saroop. Before we begin, a few quick announcements for the attendees. Anything said on this call which reflects outlook for the future or which could be construed as a forward looking statement may involve risks and uncertainties. Such statements or comments are not guarantees of future performance and actual results may differ from those statements.
Additionally, please note that this earnings call is scheduled for a duration of 45 minutes and we will be starting directly with the Q and A section of the call.
Questions and Answers:
Operator
If you wish to ask a question, please use the Raise hand feature available on your Zoom Dashboard. We will announce your name on the call and unmute your line post which you can proceed with your question. You will wait for a minute while the question queue assembles. The first question is from the line of Gaurav Malhotra from Axis. Please go ahead.
Gaurav Malhotra
Yeah, hi. Thank you for the opportunity. I had three questions. So first question is on the overall EBITDA guidance or indication of say a billion dollars for FY29. Now we do know that food is sort of at a steady clip and it’s also growing at that 1920%. We do know about district EBITDA guidance of FY30. So if I just strip it back then essentially and we know what is the Nov growth of CHR of 60% for quick commerce, then the implied margin for quick commerce comes to around say roughly 3%, 3, 3 and a half percent give or take. So is that the number which we are expecting from a margin perspective in the say next three, four years?
Akshant Goyal
I think broadly the maths is fine. We’re not giving any specific guidance but and therefore it could. The numbers could move a little bit depending on how things pan out. But yeah, broadly the way you did the maths, broadly in line with how we’re thinking about it.
Gaurav Malhotra
Thank you. Just two quick more questions. You know we see that your fixed cost in quick commerce has been sort of flattish this quarter and yet the MTU numbers have been quite, quite strong. So just wanted to get a sense as to, you know, how to sort of reconcile these two numbers. And the second question is just on the dark stores. You know I remember you had mentioned that maybe you’ll pick up the number the additions in this quarter but sort of flattish again. So Just wanted to get a sense on the dark store guidance of 3,000 by March. These are the only two questions.
Akshant Goyal
Yeah, so Gaurav, I think the fixed costs, I mean like the, the MPO edition remains strong because we continue to spend on marketing for new customer acquisitions. So I think those spends haven’t come down in the last quarter and hence the overall fixed cost remains in line with the previous quarter. And the MTU addition also remains strong. So we are seeing, I think a lot of our competitors in the market we feel have pulled back on this. So we are seeing extremely low cost of customer acquisition and we continue to see therefore value in keeping the marketing spends high at this point on the store edition.
I think we are on track on our guidance for March 3000 stores. I think we remain firmly on track. And beyond that, like, I don’t think beyond that we’re going to give any guidance or at least this point we don’t think it makes sense. I think we’ve given overall guidance of 60% CAGR. And that would obviously mean some reasonable store expansion. But we are not planning to give out any specific number guidance on that.
Gaurav Malhotra
So just, just a follow up. So essentially if 3000 store happens, that means the, the general growth for FY27 will not be 100% as you had indicated earlier. It’ll be say in the 70 to 80% print. Right. Is. Is the understanding correct?
Akshant Goyal
Yeah, it will not be 100% but we are not guiding to a specific number. I think we need that flexibility in the medium term and short term to respond to how the market dynamics are and hence. But we know that, you know, street is looking for some guidance. But what we have done here is actually given a more longer term, three year guidance. And I think short term we will respond to the market situation and if there are opportunities for acceleration, we’ll do that. Right. So we’re not closing the door on any options for us now in the next 12 months.
Gaurav Malhotra
Thank you so much.
Operator
Thank you. Next question is from the line of Manish Adukya from Goldman Sachs. Please go ahead.
Manish Adukia
Thank you. Hi, good afternoon. Thank you for taking my questions. My first question is actually a follow on from Gaurav’s previous question. Sukshant, like Gaurav asked, the 100% guidance now does not hold true for F27 given what you saw in the market in terms of competition, etc. So now when you give your medium term guidance of 60% CAGR, what margin of safety or room for error are you building in that guidance? I mean, if competition were to remain as is or were to get slightly worse from here, what are the range of outcomes of the 60% CAG?
And the reason I’m asking is that because from a near term perspective you could maybe help us understand the building blocks as to where you could see the next three year growth end up. To get to that 60% that may help us, you know, just a build, just build that number. A light, a little bit more conviction. That’s my first question.
Akshant Goyal
Yeah. Hi Manish. So I think we’ve addressed that in question three of the letter. I think we’ve sort of tried to give you the building blocks of what the 60% CAGR guidance sort of is based upon. So it’s a function of assortment expansion, geographical expansion, as well as more demand densification in our cities of presence today. And we might also get into newer cities. Right. So you know, we think three year out, you know, any sort of like increase or intensifying of competitive activity. I don’t think, we don’t think it’s going to last beyond the three year period that you mentioned. So we feel fairly comfortable and confident that over a period of three years we should be able to deliver this CAGR of growth.
Manish Adukia
Sure. And thank you Akshan, for that. And maybe where I was coming from also was the building blocks in terms of. And I know you don’t want to give like a three year store guidance, but if you were to think about user growth versus frequency versus average order value, if you can maybe give us a pecking order of what drives the most amount of growth versus followed by the second followed by the third, that would also be helpful.
Akshant Goyal
Yeah, we don’t, we can’t project with that accuracy at this point. Unfortunately. We are also learning as we build in this market. Right. So these things might change. So we don’t want to put out numbers here which we then have to define in the next call.
Manish Adukia
Right. But we just. Last question on that topic from a user number perspective, given that there is a fair bit of competition and there are like a few well capitalized players in the market, and given as the market already is today, you don’t see a concern in terms of MTU or user penetration reaching closer to saturation levels in the foreseeable future.
Akshant Goyal
No, we don’t.
Manish Adukia
Very clear. Thank you. Second question on the June quarter, where you’re saying a meaningful expectation of acceleration in quarter on quarter growth, outside of the reversal of average order value and the fewer days that you had in the March quarter, are there any other Drivers that we need to be aware of whether it’s greater store adds or anything else or it’s just these two factors of AOV and fewer days.
Akshant Goyal
So the only other factor will be seasonality. Right. So it’s a different season, so we see different consumption patterns and summer drives growth in certain categories. So overall that will also lead to a slightly higher growth other than the two you mentioned.
Manish Adukia
Very clear. Thank you. Those are the questions that I had for now. I’ll jump back in the queue.
Akshant Goyal
Thank you.
Operator
Thank you. Next question is from the line of Ajita Soman from clsa. Please, please go ahead.
Aditya Soman
Yeah. Hi, good evening. So two questions. So firstly when we look at the contribution per order in the quarter we’ve seen a slight dip. This is largely a function of AOV or which obviously falls seasonally or anything more to read in the sort of drop in contribution. And then the second question on the food side we’ve seen Swiggy sort of rollout toying quite aggressively which, which is obviously a different model with a different sort of price structure. Any plans for eternal to do the same or what do you think of bistro as being that option for affordability on the food delivery side and if bistro is the option there, any sort of updates on how that business is doing.
Akshant Goyal
So on contribution, Aditya? I think multiple things that change sequentially quarter on quarter. Yeah so you mentioned aov, that is one. Right. But I mean I’m not, we’re not saying, I mean that was a key driver but there are other things also which keep changing. Last mile delivery is also seasonal in some ways. Availability changes with the supply of delivery partner changes during different months in the year and some of the other things like supply chain costs etc there could be efficiencies that we are banking in but net, net I think the movement is what you see in contribution overall that doesn’t change the trajectory of our business like so more longer term I don’t think there’s anything to fall out here.
Aditya Soman
Understand. So in, in other words as AOV goes up and some of the seasonality changes your contribution direction should be upwards at least for now. Right.
Akshant Goyal
As we move to 5, 6% margin here that we are saying we will get to at some point contribution margin will go up. Right. And on a year, on year basis we’ll see that trend consistently.
Aditya Soman
And if you were to help with that, I mean so you said that in NCR you’re doing 5, 6% margin. So which would imply like the contribution there is 8, 9% would that be the right assumption or even higher.
Akshant Goyal
We are not just sharing that data point. I don’t think it matters also. But yeah, broadly it will be somewhere in that range.
Aditya Soman
Understanding and then maybe on Bistro and toying.
Akshant Goyal
So I think so. I mean at this point we don’t have any plans to do what Swiggy is doing with toying. We’re not clear on what problem it solves for consumers or for restaurants. Right. So till the time we don’t get the clarity, I think we’ll just stay put on our focus areas, which is a Zomato. And I think Bistro is still a small experiment for us. So we’re seeing early signs of business model evolving there, but still very small and early. So I won’t want to showcase Bistro as a big bet at this point.
But I think yeah, we are watching the space and we are seeing what competition is doing. And if at any point we see a thesis there, the that makes sense, that unlocks a new market. Yeah, I will follow suit.
Aditya Soman
Very clear. Thanks Aksant.
Akshant Goyal
Thank you.
Operator
Thank you. Next question is from the line of Ankur Rudra from JP Morgan. Please go ahead.
Ankur Rudra
Hey, thank you and thank you for the targets on growth and profitability this time. Firstly in terms of the 60% growth guidance and thank you for the color in terms of the building blocks. But in the more near term, are you seeing any signs of competitive activity or early signs of competitive activity easing, which gives you any kind of visibility of this, you know, starting to play out from the next couple of quarters.
Albinder Singh Dhindsa
So competitive activity hasn’t meaningfully changed from when the last time we were on a call. And I think our stance about it is also the same, that we will sort of keep an eye out for it but do the right things for the business. And to the extent we’ve mostly delivered on what we thought we would be able to accomplish in face of whatever the competition is going on and whatever guidance you’re giving, we’re not really changing our outlook on that either.
Ankur Rudra
Super helpful. You’ve given a three year guide this time. If I look at the last two to three years, there’s been a significant amount of linearity between store editions and growth. Is there anything to suggest that that will change over the next three years?
Albinder Singh Dhindsa
I mean, it’s not a straightforward comparison. I think we are still in some parts of the network, we’re still in a store build out phase. In some other, we just have to create supply in different ways to service customers when we are expanding assortment. So our job is to make sure that the supply is there, whether it’s in smaller stores, bigger stores. I think that number becomes very complicated if you start doing the math that way. So it’s hard to quantify it in that simplistic way.
Ankur Rudra
Appreciate the color. Just finally, in terms of profitability For Blinkit, approximately 3% is what you’ve said seems broadly fine. What are the biggest unlocks for you either in terms of cost or monetization to get there on a three year basis?
Albinder Singh Dhindsa
I think so far we are not really assuming any further unlocks which would really do it. I think if we just keep doing our job and executing the way we are doing, we should be able to get there.
Ankur Rudra
Okay, Appreciate it. Thank you.
Operator
Thank you. Next question is from the line of Abhishek Banerjee from ICICI Securities. Please go ahead.
Abhisek Banerjee
Hey. Hi. Congrats on a great set of numbers. First on the growth in quick commerce. You seem to be still growing ahead of the market. So, so do you, do you think that, you know when you say about 60% Nov growth going ahead, are you actually happy to grow in line with the market in the future? And, and you know why, why is that? And I had have another question which is slightly backward looking. So now that you have, you know, you have achieved profitability rather steadily. So what do you think is the most non negotiable KPI that you have to crack in order to get get to profitability in qc? Is it orders per day per store or is it your Nov number?
Albinder Singh Dhindsa
So Abhishek, I think to your first question, right. I think we are in a fairly competitive market with a lot of different players in that market. It is hard to figure out, you know, what is the actual market growth rate apart from the two public players who actually have to share their numbers. It’s very hard to be able to say that this is where the market is growing at. Is it a healthy growth rate or is an unhealthy growth rate? I think we are more concerned with whether our quality of growth is maintained as we grow.
And I think that’s our biggest. That’s actually something that the only thing that we worry about and I think going forward also I think quality growth which actually meaningfully also takes the business towards profitability and sustainability. I think that is the only non negotiable here and I mean there are multiple ways to get there but I think that’s the only non negotiable.
Abhisek Banerjee
Got it. Thanks.
Operator
Thank you. Next question is from the line of Swapnil Port Duke from JM Financial, please go ahead.
Swapnil Potdukhe
Hi, thanks for the opportunity. My first question is with respect to your warehousing capacity. You talked about 17 million of Verizon capacity spread across dark stores and supply chain, other apps, etc. Can you give a sense as to what was the number a quarterback or a year back? The reason I’m asking is like, it will help us understand like what kind of an uplayer you can get from by just utilizing the capacity or, or if. Even if this addition slows down. Going ahead. Thanks.
Akshant Goyal
We don’t disclose that, so you don’t find it in our letter. It’s not a mess.
Swapnil Potdukhe
Got it, got it. But the other number I was tracking was your orders per day, per store. I mean that number has been broadly flat for a long period of time. Any sense as to when we can see some uplift in that number? Because I mean, presumably that is where you will get a decent bit of operating leverage.
Akshant Goyal
So see, so as Alvinder mentioned, I think like the contours of the business might keep on changing, right? So we are not hung upon like certain metrics going in a certain way for the business to work. Right. So I think, you know, there could be arguments to be made on why that number, I mean for, for that number to not go up and still the business might deliver 5, 6% margin, right? That’s also possible. So, so I think, you know, we, so we’re not therefore constraining ourselves into a certain way of thinking about the business.
Right. I’m not saying that this metric will not go up, but I’m saying that the reason we’re not providing a guidance for this metric and how this will trend up and instead we’re giving a guidance of the overall growth of the business is because these variables and the building blocks of how we look at the business might evolve as we go along. Right. So it’s a good number to track. That’s why we disclose it. But you know, we are not sure of like how this will trend and therefore we don’t want to give a guidance on it. Right.
Swapnil Potdukhe
Got it. This, this, this one metric, another metric that I track, basically customer retention, the number of orders that every customer gives you. That number seems to have come down off for the last couple of quarters. It used to be around 3.6, now it is down to 3.35. Is that to do with some retention getting impacted because of high competitive intensity or is it a function of significant addition in new customers and their ordering frequencies being lower?
Akshant Goyal
Yeah, it’s largely the latter Swapnil I think we haven’t seen too much impact on customer retention despite us being sort of more competitive. I mean more like more expensive for customers in certain geographies. So I think most of this is on account of the acceleration in new customer addition that we have seen the last couple of quarters.
Swapnil Potdukhe
But and just on your fidelity commentary now you did say that you have been offering a lower MOE’s of around 99 to make food more affordable. But at the same time you have been consistently increasing your platform fees. You know, those kind of things. So how does that tie up? I mean like right, if you were to make it affordable, you should not be increasing platform fees.
Akshant Goyal
Yeah. So I think what, what we mean by, by that essentially the platform is applicable to all customers, but the, the, the offers or discounts can be targeted to a certain cohort of customers who are more price sensitive. Right. Or, or in certain locations and geographies where e subsidies actually deliver growth. Right. So, so that doesn’t work for all customers or all geographies. But I think what we’re doing, trying to do essentially is increase the overall revenue per order by increasing the platform fee and then then channel that revenue to select cohort of customers in select geographies where we are seeing growth.
Swapnil Potdukhe
Okay. And just the last one quickly on the district also, I mean there have been constant media reports that there are some events getting cancelled because of inability of certain artists not coming to India because of the war. Any sense as to like will the business still continue to deliver strong numbers despite all this macro challenges on that business?
Akshant Goyal
I don’t think this will impact the overall broad growth part of the business. Events is a just a part of the business and we have multiple categories now. So I don’t think few concerts getting delayed or postponed or even cancelled will impact the outlook on the business.
Swapnil Potdukhe
Perfect. Thanks a lot for taking my question and all the best guys. Thank you.
Operator
Thank you. Next question is from the line of Ashwin Mehta from Ambitious. Please go ahead.
Ashwin Mehta
Yeah, hi, can you, can you hear me all right?
Akshant Goyal
Yeah, Shwin. Hi, go ahead.
Ashwin Mehta
Hi. Thanks. Thanks for the opportunity. One question. So if I look at your consolidated financials, your advertising promotion cost in absolute terms was flat sequentially. So any sense that you can give in terms of what proportion of this goes to to blink it and the follow up to that is philosophically, how are you thinking in terms of reacting to competition? Because newsflow seems to suggest that one of your competition seems to be growing much faster sequentially at least. So are you okay to let go of some market share near term and still focus on profitability or you will possibly react to to some of them given the guidance of 60% plus growth.
Kunal Swarup
Hi Ashwin, this is Kunal here. So to your first question of consolidated ad promotions includes multiple things across our multiple businesses, right? So there is promotional spend. So let’s say on the food delivery side, like Akshan said, we channelize some of our incremental revenue per order to a certain cohort of value conscious customers that would sit there. There are you know, obviously customer acquisition spends for our quick commerce business marketing spends for food delivery. So it’s, you know, I think each business is also has its own nuances and dynamics. So I don’t think we can, you know, strip that apart and get into each of those. I think broadly the commentary we’ve given for each business kind of reflects our strategy for each business there.
Albinder Singh Dhindsa
And yes, and I’ll answer the question on growth, Ashwin. See I think the best of our knowledge we are growing as, as fast as we can in the market adhering to the principle that the growth actually has to be meaningful and it has to be healthy for the business both in the short term and in the long term. Of course you can always make the argument that you know, we can grow a lot faster by opting for unhealthy growth. Right now we just don’t think that that is the right thing to do and that that growth will eventually turn into, you know, healthy growth just by magic. So as far as we know, you know, this is the fastest that, that we’ve been able to grow this quarter, you know, in a very, in a way which still adheres to our core principles.
Ashwin Mehta
Sure. Thanks Alvinder and all the best.
Albinder Singh Dhindsa
Thanks.
Operator
Thank you. Next question is from the line of Jignanshu Gore from Bernstein. Please go ahead.
Jignanshu Gor
Hi. Thank you for the opportunity. I have two questions. One is as a large part of our growth narrative from here on depends in some sense on either growing the non sort of grocery assortment and going deeper into outside of the metro cities. Two questions related to these. One, is there possible to give some quantitative understanding of how some of the non metro cities are doing in terms of size of business per store? I understand the profitability margin metric which was in the, in the letter but in terms of size either revenue or order per day, what kind of ratio can we expect in metro versus tier one or a tier two town?
I think that’s question one and let me ask the second one so that if there is any interdependence, the Second is we see that inventory days seem to have gone up over the last few quarters after the transition as well. Right. To 1p. So what would be the driver for this and where would we feel comfortable? Not from a working capital deployment, but just from a risk perspective, what would be comforting for us?
Albinder Singh Dhindsa
Yeah, so we don’t, we don’t disclose the breakup intentionally for whatever our business is in the larger cities versus emerging cities. And on the second part, I think before we give more color, I don’t think it is related. The, the inventory days are not related to in any ways to the split that we have between tier 1 and tier 2 or tier 3 cities
Kunal Swarup
And Jignanshu just on that inventory build. When you said last few quarters, of course we’re aware that last few quarters, from Q2, Q3 especially, we saw the shift to 1p. Right. And the share of 1p also increased during that time. But Q3 to Q4, there hasn’t been any meaningful increase apart from the increase expected because of the growth in the scale of the business. Right.
Akshant Goyal
That doesn’t change the 90 days anyways. Yeah, So I think 90 days are fairly steady and we’re not seeing that increase unlike what you suggested.
Jignanshu Gor
Okay, cool. Just then maybe a follow up. Just one small point on the. If we look at the standalone business, my understanding is that includes and specifically looking at ad spends. It includes basically food delivery plus district ad spends. Is that the right assumption?
Kunal Swarup
It’s not the entire district but a part of the going out business, largely the dining out business. Yeah.
Jignanshu Gor
Okay. So even for dining out, it’s a small part. So.
Akshant Goyal
Okay. Our businesses are split across multiple entities. So generally speaking, I think it’s hard to reconcile our mis that we, the way we reported to our audited financials, you know, unless you have more data.
Jignanshu Gor
All right. I was trying to reconcile your statement that you are seeing a low CAC on the Quick Commerce business and hence trying to reconcile that with the MTU edition.
Akshant Goyal
Yes, that’s correct. So I think for the same marketing dollars we are seeing more new customer addition. Right. So that’s what I meant when I said the CAC for us is reducing.
Jignanshu Gor
Yes. All right, great. Thank you.
Operator
Thank you. Next question is from the line of Gaurav Ratheria from Morgan Stanley. Please go ahead.
Gaurav Rateria
Yeah. Hi. Congratulations on good performance on profitability in Quick Commerce. I have two questions. My first question is on your comments around competition which probably hasn’t changed much in the last couple of months and still you expect a 60% plus CAGR in the quick Commerce business. So is it that you’re not changing your stance and you still expect this helding growth to continue at 60% and at what point in time you need to kind of relook at the stance on your certain thresholds of MOV or other things.
What is a North Star metric that you focus on whether it is MTC addition, number of order growth, Nov growth etc to be able or market share to be able to understand that at what point in time you need to change your stance to react to the competition.
Albinder Singh Dhindsa
I think we keep reacting according to what we feel is right and it all depends on micro markets. So I don’t think our stance is more around the principles that we have around building a healthy business. And you know there are places where our MOV is also lower. There are places where we also offer free delivery and I think these are not unidimensional calls for us and we keep taking them
Akshant Goyal
Largely. Gaurav. I think we look at, you know, customer retention and customer frequency on our own business. Right. I think as long as we don’t see that being impacted in a meaningful way, why what everyone else is doing, I think then you know the choice to stick to the principles Alvinder mentioned is still there. Right. So we haven’t over the last few months seen our customers turn away from our platform too much and hence I think at this point we don’t see the need to react more than what we’ve already done.
Gaurav Rateria
Got it. My second question is on your tier top eight cities you did give a very good data point on geographic coverage of 80, 90% coverage in the PIN codes. Does it mean that now from here on incrementally growth will be less led by the customer addition in these top eight cities and more by the wallet share and the average spend per customers and and hence the growth rates. When we look at the MTC edition it is going to be largely, largely driven by the non profit cities. Thank you.
Akshant Goyal
Partly true, but I think even in these cities where we have high PIN code coverage it doesn’t mean that we have maxed out on potential customers in that neighborhood. While assortment expansion will drive higher wallet share for existing customers, but I think equally or maybe even larger portion of growth will continue to be customer addition given the low penetration that we have within the PIN codes that we cover.
Gaurav Rateria
Thank you. All the best.
Akshant Goyal
Thank you.
Operator
Thank you. Next question is from the line of Garima Mishra from Kotak. Please go ahead.
Garima Mishra
Yeah, thanks for the opportunity. First question on Blinkit. How should we think about the Discounting which is prevalent in the quick commerce market today. And how confident are you of maintaining your pricing discipline as well as a 60% growth CAGR in the business?
Albinder Singh Dhindsa
G We are very confident of maintaining our pricing discipline. We’re not sure what competition will do. I think the it is very hard to estimate what is happening in the market, frankly. How much of the. How much of the market is fraught, how much of it is artificially inflated by discounts? It’s very hard to actually tell. So very hard to comment on that.
Garima Mishra
But you remain confident in that you’ll be able. You are already retaining that customer who you think is the more profitable customer and sort of sits well within what Blinkit stands for. Is that the right understanding?
Albinder Singh Dhindsa
Yes.
Garima Mishra
Got it. Second question was on district. You are already present in different verticals pertaining to the broad going out category. What new categories are you looking to add within District and particularly within travel?
Akshant Goyal
So Garima, I think no plans to add any more category to district than we what we already have and I don’t think travel is a focus area for us at this point.
Garima Mishra
Got it. And last question. Maybe Hyperpure reported a small margin in the quarter. You have however not included this segment when you talk about your future profitability. How should we read this and should we assume that this business remains insignificant from an overall, you know, profitability perspective?
Akshant Goyal
Not really. I think. I don’t know why you are saying that we haven’t included this business when we’re talking of. I mean the overall billion dollar profit statement that we have made includes all the businesses that we are into today, including Hyperflow. It will of course it might be the smallest but it will still be meaningful and relevant.
Garima Mishra
Got it. Thank you so much.
Operator
Thank you. Next question is from the line of Rishi Jonjunwala from iifl. Please go ahead.
Rishi Jhunjhunwala
Yes, thank you. A couple of questions. Firstly, see if we look at our order growth in food delivery as well as in QC. So in food order growth was 15% YoY but the active delivery partners on a monthly basis went up by 30%. In QC also the order growth was slightly above 90% but the rider growth was 120%. While in QC I can still understand that you’re expanding rapidly and probably adding a lot more there. But in food you know what explains this gap given that effectively if I calculate ride in number of orders per rider per month it has come down by 10 to 15% in both the businesses over the last one year.
Albinder Singh Dhindsa
The Rishis nuance over here is the changing nature of how much people work every day on these platforms. So we are seeing more and more part timers also delivering and that actually increases the active partners but reduces the number of orders they do per shift per day.
Rishi Jhunjhunwala
Understood. The second question is on food delivery, right. So we are close to that 20% mark. From a growth perspective we are at 5.5%. From a margin perspective we had taken a mid quarter hike in platform fee. Probably next quarter it flows down completely to the bottom line. So how do we think about, you know, incremental operating leverage that you would get in the business as well as some of these increase in monetization to flow through the food delivery P L Do you intend to utilize that incrementally in in some sort to increase growth?
And if yes, how or otherwise do you believe there is actually there could potentially be upside risk to that, you know Nov. Margin guidance that you have provided in the past?
Akshant Goyal
So I think this is, I mean this has always been the case that we are more leaning towards growth. Right. So if we can find ways of effectively reinvesting any incremental margins that we get in our business, any business, I think we would do that because the objective is to optimize for growth of absolute profit and not the profit margin percentage. So that’s always been the principle and it will remain that way. I think what we are seeing now in the last 2, 3/4, especially in the food delivery business is a good ROI on the.
On these investments for growth. Right. That, and that’s a function of like. Also like us innovating on how we look at these investments. Right. And how we implement. So it comes down to execution also. And it’s also a function of like market readiness, consumer readiness and so on. So at this point therefore we are seeing that if we reinvest in growth, we are getting outcomes and that growth quality is good. So we’ll continue doing that without worrying about what it does to the margin. I think net.
Net this should ensure that our absolute profit continue to grow at the fastest pace possible the food delivery business. But in future, again applying the same principle, if that stops happening, we could see some of this incremental revenue flowing down to profitability and that’s also fine. Right. So I think I just. That’s the sort of framework that we follow and outcome could be either percentage margin increasing or growth going up. Both of them will actually optimize for the absolute dollar ebitda.
Rishi Jhunjhunwala
Understood. Thank you so much. All the best.
Akshant Goyal
Thank you.
Operator
Thank you. Ladies and gentlemen. In the interest of time, we Will now take the last one to do. Participants next question is from the line of Vijit Jain from Citigroup. Please go ahead.
Vijit Jain
Yeah, hi, thank you for the opportunity. My first question is so, you know, within that guidance of 60% plus CAGR on quick commerce, you know, the top 20 cities that you call out, would this still be, you know, about 40% within that any, any kind of, you know, assessment of what that embeds for top 20 cities that you could give would be helpful. That’s my first question. My second question is, you know, within qc in terms of, you know, the ad monetization, I just want to get a handle on, you know, is.
In terms of the monetization, is it mostly, you know, driven by the SKUs that you stock and that you’re able to, you know, sell surface to the customers or the ad loads at checkout and top of the funnel ads are meaningful. That’s the second thing I wanted to ask. And third, if you could give more color on how you think about the whole supply chain automation. You talked about it, I think in 3Q and I just wanted to get a sense of are we looking in the next two to three years at more of these automation capex for your business and any sort of guide you can give on how you’re thinking about capex beyond the store additions that you would do.
Those are my three questions. Thank you.
Albinder Singh Dhindsa
So widget, the first one, we don’t give that breakup and I think we won’t be able to give you that color. I didn’t really understand the second question. I think if you.
Vijit Jain
I just wanted to understand the ads business. Right. The ad monetization that you achieve. My guess would be the, the biggest chunk of that is the brands themselves advertising on you for stock that you actually hold on the platform. But there will also be ads related to that you show on checkout or ads which are more like the brand page that you have. And I wanted to get a sense of what the composition of your ad revenues looks like between these two. Three different kinds of categories.
Albinder Singh Dhindsa
So non, you know, non trade ads. Basically ads buy brands or platforms which don’t sell on the blinkit platform. That’s insignificant for us.
Vijit Jain
Correct. Perfect. And the last question was on, you know, CapEx and how much of, you know, what capex you plan to do the next two, three years is related to, you know, automation that you might do. I’m just trying to get a Sense of whether automation, you know, all the automation that I think you guys have shown in some videos as well, how much of that is scalable and is, is that something that you’re planning to do across all of your warehouses and so on?
Akshant Goyal
Yeah. So Vijay, they keep testing for that. I think like we are not, we don’t want to just pursue automation for the sake of it. I think the, the framework is that the capex should have roce that, that we can track and that is visible. Right. So that’s the fundamental principle. But directionally, yes, I think what we are seeing is that more and more, I mean directionally we are seeing the automation increasing in both our warehouses, in all our warehouses. So we will see that happening over the next few years as well. But how much of it is automated is a function of again the framework on roc. Right. So it’s all a function of the cost and the efficiency uplift we get because of automation.
Vijit Jain
Thank you. Those are my questions. Thank you so much.
Akshant Goyal
Thank you.
Operator
Thank you. Last question is from the line of Sachin Salgaonkar from Bank of America. Please go ahead.
Sachin Salgaonkar
Thank you for the opportunity and congrats on great set of numbers. First question is on competition. Just wanted to understand is competition also intense in tier 2, tier 3 cities or is it that there are few operators and hence competition is reasonably lower out there?
Albinder Singh Dhindsa
I think competitive intensity is fairly high pretty much wherever everybody’s reaching…
Akshant Goyal
A different kind of, I mean different set of players in different markets. Right. But someone is aggressive somewhere at this point. Right. So for us it’s competitive everywhere.
Sachin Salgaonkar
Got it. In terms of dark store additions, when we think about it, is the mix still 80% urban and 20% tier 2, tier 3 or that has changed over a period of time?
Akshant Goyal
That’s changing, Sachin. And I think, I mean we’re not giving a specific guidance as we mentioned but increasingly I think as we’ve also mentioned in the letter, a large part of our growth will come from geographic diversification. So we will see that mix change over time.
Sachin Salgaonkar
Okay. And you know other what you mentioned in your letter is obviously assortment expansion. So does that mean we are looking to upgrade some of the dark stores to bigger sized dark stores now or add more dark stores in the vicinity?
Albinder Singh Dhindsa
I think that means we are going to expand our assortment by whichever way we can.
Akshant Goyal
So for us it’s like square foot space. Right. So size of the store is a function of lot of factors. Availability, the specific neighborhood, the urban infrastructure in that neighborhood. So it’s a very hyper local call. There is no sort of one single sort of answer for this that applies to every, every city and every Locality.
Sachin Salgaonkar
Got it pretty clear. Next question is on AI on ads. You know we are seeing multiple platforms globally actually now seeing that the ceiling on ad revenue as a percentage of gov has now started to move up because AI does allow them to do a lot more things and you know, push ad per se from that point of view, you guys clearly are doing a lot on AI. So does that mean that you know, at some point in future also what are we expecting as a sort of a gap on add as a percentage of GMV that might move up and hence there’s room for your steady state margins also to move up in both food as well as with Com.
Akshant Goyal
Generally we don’t operate like with a cap in a mind. Right. I mean we don’t know what the cap is honestly. Right. So I think we’ll respond to the realities of the situation around us in the business. Right. And if that means that we have an opportunity to to have higher ad income in our business, so be it. Right. And same framework then if we have that we have more margins, can we invest in growth? Can that growth drive more profit? Like so that’s the mental model which is fairly fundamental and simple but we don’t operate with a set of fellow metrics with some ceilings or target or goals in mind. So I don’t have like any other color to share on this.
Sachin Salgaonkar
Got it. And accent, when we talk about quick commerce margins at steady State being at 5 to 6% is there an implied assumption in terms of, you know, how much AD out here is in terms of that 5 to 6%.
Akshant Goyal
No, no, as I said, I mean like we don’t know we’re discovering that like we haven’t, I mean like quick farmers is a much younger business and food delivery, it’s already doing more in terms of ad as a percentage of Nov. Right. So, so we don’t, I mean we necessarily don’t have a number in mind here on where does it land and finally go to.
Sachin Salgaonkar
Got it. And last question is if there is any sensitivity on higher fuel prices to demand on food. Historically have we seen anything when fuel prices have increased? There has been an impact in demand.
Akshant Goyal
So it depends on the quantum. Generally you know, increase in fuel prices will lead to higher cost of delivery. The last mile cost goes up. So now what percentage of that we decide to pass on to consumers is something that we’ll decide when the time comes. Right. So it all depends on that quantum. In the past, if you see going by the last 12, 18 months experiences and examples like the GST hike happened, we were fairly easily able to pass it on to consumers without too much impact on demand. So unless it’s a drastic increase, I don’t expect fuel price increase to have a meaningful impact on margins on our business.
Sachin Salgaonkar
Got it. All the best. Thanks.
Akshant Goyal
Thank you.
Operator
Thank you, ladies and gentlemen, we will now conclude this conference call. Thank you for joining us. And you may now disconnect your lines.