The shift comes after Swiggy held its analyst day, where the company laid out a target of ₹10,000 crore – in adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA), a measure of core operating profit — by 2030-31 (FY31), along with 30% growth in gross order value.
Taurani said Swiggy’s quick commerce arm, Instamart, has shown inconsistent execution on the path to profitability. “I would still avoid Swiggy for now,” he said, noting that Instamart broke even on contribution margin last quarter but the company then guided for faster growth alongside a return to negative contribution margin.
By contrast, Taurani said Eternal has executed consistently and needs to sustain an EBITDA growth rate of nearly 40% compounded per quarter over the next 12 quarters to hit its own target of ₹5,000 crore in adjusted EBITDA by 2028-29 (FY29).
He expects the company can maintain that pace given its recent track record, though he flagged that quick commerce valuations for Eternal are not cheap, trading at 54 times enterprise value to EBITDA on FY28 estimates.
He also pointed to Blinkit, Eternal’s quick commerce arm, as the platform most likely to keep surprising on profitability, while describing Swiggy’s Instamart as caught between chasing growth and profitability at the same time.
Turning to retail, Taurani said fashion and lifestyle retailer Trent remains a top pick despite a slowdown in growth to the 18-20% range from the 35-40% levels investors had earlier expected.
He said competitive intensity in the fast fashion market, which saw six to seven new entrants roughly 18 months ago, has since eased as only select players continue to expand aggressively. Combined with Trent’s margin gains from its product mix and operating efficiency, he believes growth could even move up to 20-23% if execution stays on track.
“There’s an accumulated chance for Trent here, and it could outperform given the external variables playing out in their favour,” Taurani said. He added that Trent, along with DMart and Jubilant FoodWorks, has already re-rated by 20-25% over the past three months and is now largely priced for FY28 earnings, leaving limited near-term upside.
Taurani said the alcoholic beverages sector has also risen 20-25% in the same period on continued premiumisation trends, even without a major pickup in volume growth. He pointed to potential state-level triggers ahead, including a possible move by Tamil Nadu toward privatising liquor retail, Karnataka’s revised pricing slabs, and a possible opening up of the market in Bihar next year, alongside the already-priced-in benefit from the UK-India free trade agreement.
He continues to favour United Spirits and Radico Khaitan over United Breweries, citing weaker margin consistency in the beer business, even as all three trade at similarly rich valuations near 52-55 times price-to-earnings on FY28 estimates.
Among smaller players, he named Tilaknagar Industries and Allied Blenders as the biggest beneficiaries of any Tamil Nadu policy change.
Taurani named Sun TV and PVR Inox as his top picks from the media sector. He cited PVR Inox’s improving free cash flow, content pipeline, and lower valuations, and said Sun TV could see value creation if its sports business is separated out.
For the full interview, watch the accompanying video
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