Updated Mar 12, 2026 13:03 IST
Eternal-Swiggy Share Price: The direct impact of Iran war tension is now visible on India’s hotel and restaurant business…
highlights
- Amidst the fear of shortage of LPG cylinders, there seems to be a big impact on the business of hotels and restaurants.
- On Thursday, shares of Eternal and Swiggy fell by about 4%.
- Shares of Jubilant FoodWorks, Sapphire Foods, Westlife Foodworld and Devyani International also fell.
Eternal-Swiggy Share Price: The effect of increasing geo-political tension in West Asia seems to be rapidly affecting India as well and the restaurant and food delivery sector is also being hit by it. After the fear of shortage of commercial LPG cylinders, its impact started becoming visible on the hotel and restaurant business across the country. At some places there were long queues outside the gas agencies and at some places the food cooked on slow flame was off the menu. Due to this, there was a sharp decline in many shares related to this sector on Thursday. Stocks of food delivery and quick service restaurant (QSR) companies fell up to 4% on Thursday.
In the stock market on Thursday, Eternal’s shares fell by about 4.7% to around Rs 213, while Swiggy’s shares also slipped by about 4.7% to around Rs 271.
Pressure on shares of QSR companies
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This fall in the stock market was not limited to food delivery platforms only. Many big shares related to restaurant chains also appeared under pressure. Shares of Jubilant FoodWorks fell about 4.27%, while Sapphire Foods India weakened by about 3.9%. Similarly, Westlife Foodworld fell by about 3.3% and Devyani International by about 2.5%.
Why did tension increase?
According to the report of brokerage JM Financial, about 60% to 65% of the food in the QSR sector is cooked on LPG. In such a situation, if the gas supply is interrupted, the operation of the kitchen may be affected. Reports suggest that large restaurant chains usually keep 1 to 2 weeks of gas stock. But if the supply remains disrupted for longer than this, they will either have to buy expensive gas or may have to increase the menu prices.
Bigger loss than supply stoppage of 5 days
Analysts estimate that if the supply of LPG cylinders stops even for just 5 days, the revenue per store could decline by about 6% in a quarter. This can have an even greater impact on the profits of companies. According to the report, in such a situation the EBITDA of the restaurant may fall by about 14% to 20% compared to the normal level. This is because sales will reduce, but rent, employee salaries and other fixed expenses will continue.
Pressure on restaurants in big cities
Many restaurant owners in big cities like Mumbai and Bengaluru are already facing difficult circumstances. People associated with the industry say that the supply of commercial LPG cylinders has become extremely limited in the last few days. According to the Indian Hotel and Restaurant Association, about 20% of the hotels in Mumbai have already been closed. If the gas shortage continues for a long time, this number could reach 50%.
Expense burden on customers may increase
If the situation does not normalize soon, companies may have to pass on some part of the increased expenses to customers. This means that food delivery charges may increase in the future or restaurant menus may become expensive. However, larger QSR chains have backup systems and better supply chains, putting them in a slightly better position than smaller restaurants. But due to high gas consumption, they too are not completely untouched by this crisis.
Disclaimer: This article is for informational purposes only and should not be construed as investment advice in any way. ET NOW Swadesh recommends its readers and viewers to consult their financial advisors before taking any money-related decisions.
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