Eternal's District Is Still Searching For Its Footing

A year after Eternal (formerly Zomato) acquired Paytm Insider for a staggering INR 2,048 Cr, at roughly 6–7X of the latter’s FY24 revenue, the foodtech giant is struggling to justify the price tag of its ambitious ‘going-out’ bet.

While District (the app built atop that acquisition) is being touted as Eternal’s next big growth engine, its numbers paint a different picture.

In Q2 FY26,District’s revenue rose 23% year-on-year (YoY) to INR 189 Cr but declined 9% sequentially from the previous quarter.

Losses widened 19% to INR 57 Cr, erasing the profit of INR 18 Cr the business posted in the same quarter last year (Q2 FY25). For a platform once touted as the future of Eternal’s lifestyle ecosystem, its short-term performance appears far from reassuring.

Still, Eternal remains unfazed.

Backed by a 32% YoY rise in visitors and a growing base of active users, District’s evolution, as per the company, is a long game, one that will extend far beyond quarterly swings.

“Our customer base continues to expand rapidly, which is giving us the confidence to continue investing in building District as the one-stop destination in India for discovering multiple going-out use cases,” an Eternal spokesperson said during its Q2 earnings call.

So, as the company expands its going-out footprint — spanning live events, dining, retail discovery, and even a global launch in the UAE — the question isn’t just whether District can become Eternal’s next growth engine, but whether it deserves to be seen as one.

District May Be Stretching Too Thin?

In under a year, Eternal’s vision for District has evolved beyond its initial focus on the events segment. Earlier this year, the company added a new vertical, District Stores, making Eternal’s formal entry into offline retail discovery.

The move aims to digitise the offline shopping experience by helping users discover nearby outlets, access exclusive deals, and scan QR codes for instant rewards. Customers can redeem up to INR 500 in discounts or earn complimentary movie and dining vouchers for in-store purchases.

So far, the platform has integrated over 3,400 outlets across six Indian cities, facilitating more than 60,000 transactions, the company said in its shareholders’ letter.

“Eternal is clearly trying to stitch together the full out-of-home journey, from booking a table to shopping nearby, but the challenge will be focus. It’s an interesting play, but at this stage, District risks spreading itself too thin across too many categories before establishing a strong anchor,” an executive at a rival live event company said, requesting anonymity.

The expansion isn’t just limited to the home turf. In Q2 FY26, Eternal launched District in the UAE, merging its dining-out and live events offerings into a single app.

The company argues that the region’s strong dining culture and entertainment scene make it an ideal testing ground. The rollout also leverages Eternal’s pre-existing brand equity from Zomato’s food delivery network in the Middle East, giving District a ready customer base to tap into.

“Together, these moves suggest Eternal’s ambition is no longer just to compete with BookMyShow in ticketing, but to build a multi-use lifestyle discovery platform, one that extends its brand relevance every time a consumer steps out of home. But it requires heavy investment,” the executive quote above added.

A Tale Of Tough Execution

Eternal’s bold vision for District is starting to witness execution challenges. A year after its high-profile INR 2,048 Cr acquisition of Paytm Insider, the platform is still struggling to find its footing. Despite aggressive expansion and strong user metrics, profitability remains distant, and consistency elusive. During the earnings call, Eternal’s CFO Akshant Goyal described the loss as part of a controlled investment cycle.

On the other hand, while the number of visitors has improved, it remains uncertain how effectively their interest converts into sustained monetisation.

Meanwhile, analysts argue that the company’s capital allocation deserves scrutiny.

“District started well as the Diljit Dosanjh concert was a breakout success that helped them cross 6 Mn downloads. But since then, there haven’t been many marquee events. They’ll need more consistent hooks to sustain engagement,” said Lloyd Mathias, a business strategist.

Mathias believes that Eternal should shift its focus from one-off spectacles to everyday cultural experiences.

“The next phase should be about frequent, localised experiences such as pop-ups, brand activations, neighbourhood gigs which are more margin-positive and build community stickiness,” he added.

Leadership bandwidth could also become a bottleneck.

This is because most of Eternal’s top management focusses on Blinkit and Zomato. “District needs dedicated strategic leadership with deep event-industry experience if it’s to scale meaningfully,” Mathias said.

Next Challenge: Turn Visibility Into Value

While industry veterans see a long road ahead, they believe there is an opportunity for District to shape the next phase of India’s live experiences market.

The market potential is ignificant. Analysts estimate the live entertainment and ticketing sector could grow 20–30% annually over the next few years, driven by festivals, youth culture, and brand-led experiences. However, Eternal’s “going-out” vertical must decide what kind of brand it wants to be.

“Right now, District is visible across multiple event types, but it still feels like a platform searching for identity,” said Nishant Kini, the founder of a Bengaluru-based branding and events agency, The Nishé & Co.

“If they invest in creative intellectual properties such as sustainability festivals, city-specific art experiences, or regional food and culture events, they can evolve from a ticketing app into a cultural brand,” he added.

Overall, in the events space, profitability takes years to come. BookMyShow took nearly two decades to make Sunburn profitable. Similarly, the foodtech giant will need patience if District is to follow a similar path. For now, District remains a high-cost, high-potential experiment, to say the least.

[Edited by Shshir Parasher]

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