The new-age PE joke was never the point.

Eternal and Swiggy sell the same thing, in the same cities, to the same customer, through nearly identical apps. In Q1 FY27, one made money and the other lost ₹791 crore. That gap is not about PE ratios. It is about who actually built a profit pool and who is still buying one.

The stakes

Every year someone writes the same column: new-age tech has no earnings, so it has no valuation logic, so it is a bubble. The column is comfortable because it uses a formula everyone learned in business school. It is also increasingly wrong, and the last two quarters of Indian listed new-age results are the proof.

The thesis

The “infinite PE” critique confuses a company with no profit today for a company with no path to profit ever. Those are different things. A widening set of Indian new-age companies has moved from “we are losing money to buy the market” to “we are losing money in one segment because we are printing it in another.” That is not a valuation anomaly. That is a company mid-transition, and the market has started pricing the transition, not the trailing twelve months.

The evidence

Start with food delivery and quick commerce, because it is the cleanest natural experiment in Indian markets right now. Two companies, one market, opposite outcomes.

Eternal’s consolidated net profit was ₹92 crore in Q1 FY27, up 268% year on year from ₹25 crore. A year earlier, that same profit line had cratered 90% because the company was pouring money into Blinkit’s dark store build-out. The burn was real. It was also temporary. Blinkit’s revenue went from ₹2,400 crore to ₹15,664 crore in four quarters and crossed adjusted EBITDA profitability, contributing ₹102 crore. Food delivery, the older and more boring business, threw off ₹606 crore of adjusted EBITDA on its own. Two engines, both profitable, at the same time.

Swiggy, in the identical quarter, reported a consolidated adjusted EBITDA loss of ₹651 crore and a net loss of ₹791 crore. Its food delivery arm made ₹292 crore. Instamart lost ₹778 crore. One profitable segment could not cover one unprofitable segment. Eternal had the same structural problem eighteen months ago and solved it. Swiggy has not, yet.

This is the part the “infinite PE” crowd skips. It is not new-age tech versus old economics. It is execution versus execution, inside the same new-age playbook, with wildly different outcomes on the same income statement line.

Paytm tells the same story from a different starting point. One97 Communications lost ₹839 crore in Q1 FY25. Four quarters later it posted its first profit since September 2024, at ₹123 crore. By Q1 FY27 that profit had grown to ₹220 crore, up 79% year on year, on revenue up 28% to ₹2,448 crore. Full year FY26 profit came in at ₹552 crore against an FY25 loss of ₹663 crore. EBITDA margin more than doubled year on year to 8.29%. Management called it AI-led operating leverage. Whatever the label, the direction is unambiguous: a company the market had priced for terminal unprofitability turned a corner and kept turning it.

The reframe

The mistake in the “no profit, no sense” framing is treating profitability as a switch a company either has or does not. For a certain category of Indian new-age business, profitability is closer to a sequence: acquire the customer relationship first, because the relationship is the asset, then layer monetisation on top of a base that already exists. Blinkit did not become profitable by raising prices. It became profitable because the dark store network it built while “losing money” is now the fixed-cost base that quick commerce economics run on top of. Paytm did not become profitable by shrinking. It became profitable because the merchant and consumer base it built while “losing money” is now getting monetised through financial services distribution instead of subsidised transactions.

The old profit pools in Indian markets sat with banks, FMCG distribution, and organised retail. The new profit pools are forming inside the infrastructure these companies built while they looked unprofitable: quick commerce logistics, embedded financial services distribution, and the data layer sitting on top of both. The companies that get there first do not just capture a market. They capture the toll booth on a market that did not exist five years ago.

The close

A high PE on a loss-making company is not automatically a mispriced stock. Sometimes it is the market correctly pricing a profit pool that has not shown up in the P&L yet. The Eternal-Swiggy gap is the tell: same sector, same “new-age, no profit” starting point, and one of them has already arrived. The question worth asking about any new-age name is not whether it is profitable today. It is whether the losses are building the asset that eventually gets monetised, or just buying market share that evaporates the day the discounting stops.

If you want the full breakdown of which Indian new-age names are actually building monetisable infrastructure versus just buying growth, that is exactly the kind of thesis I dig into at Growth Titans.

14 companies. One framework. Two hours. 30th August.

I’m going deep on LTV/CAC, growth rate of change, and indirect expense quality across the listed new-age tech cohort, company by company, number by number.

No recommendation to buy, sell or hold anything. Views are personal. Just the framework, applied in public, so you can run it yourself on the next earnings call.

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Growth Titans of Q1 - 13th September, 2026

Disclaimer: Neither Saket Mehrotra nor Beta to Alpha is a SEBI registered investment advisor. Views are my own and do not represent my previous or current employer. Any mention of stocks and securities is not a recommendation to buy / sell. The author may hold positions in the stocks mentioned and sell it without prior notice. Please do your own due diligence before investing. The purpose of this newsletter is for educational purposes only.