Zomato parent Eternal moves District into a separate subsidiary

A company of its own for the going-out app

District, the Zomato-built app people use to book cinema seats, concert tickets and restaurant tables, is being moved into its own company. Eternal, the parent of Zomato, said its board approved the transfer of its going-out business to a wholly owned subsidiary, Zomato Entertainment Private Limited, on October 21, MediaNama reported, citing the company's financial results.

Eternal is keeping all of it. According to a report on the results by Multibagg, the restructuring separates this activity within the group while the subsidiary stays wholly owned by Eternal. People who book through District were not told of any change to how they book, and the app still carries the Zomato name on Google Play.

The Free Press Journal reported that the board approved a business transfer agreement with the subsidiary, under which Eternal's Going-out India business, including its assets and liabilities, moves across by slump sale on a going concern basis. Deccan Herald reported that the approval was disclosed in a BSE filing alongside the quarterly results.

Faster growth, a deeper loss

The move came with District's numbers for the quarter to September 30. Investywise, summarizing Eternal's shareholder letter, reported that the going-out segment's net order value grew 58% from a year earlier to ₹3,259 crore. BigGo Finance put adjusted revenue up 61% at ₹304 crore.

Why AI agents worry Eternal

Eternal used the same results to flag a risk particular to District. In the shareholder letter, Eternal placed District in what NewsBytes quoted as the "medium-to-high risk zone" for commerce carried out by AI agents. The concern is plain enough: restaurant tables and many concert tickets exist outside District, so a software agent could book them through other channels and bypass the app entirely.

MediaNama reported that Eternal contrasted this with Zomato and Blinkit, which it believes are protected because the company owns the delivery networks behind them. A ticket or a table has no such moat. BigGo Finance described founder Deepinder Goyal's view as District facing the greatest risk of being cut out of transactions among the group's businesses.

Venues, not just tickets

Days later came a sign of how District may respond. NewsBytes reported on October 26 that District is considering investments in dedicated live-event venues, aimed at cutting concert costs and making the platform more resilient to AI disruption. District chief executive Rahul Ganjoo told Mint that the company is in talks with possible partners and governments on long-term projects, including public-private partnerships, according to NewsBytes.

StartupTalky, reporting the same day, said the plan includes expansion into major Indian cities. Owning the room where a show happens is the kind of inventory an outside agent cannot simply route around, which is the logic Eternal has applied to its delivery businesses.

A year of doubling down

The subsidiary move caps a year in which Eternal has repeatedly committed to District. MediaNama reported that in January Eternal said it would double down on the business despite rising losses and projected it would break even within four to six quarters. In July, according to the same report, Eternal said District would have "a smaller customer base" and operate in fewer cities than Zomato and Blinkit. Akshant Goyal said District remains on track, MediaNama reported.

Salons and comedy in the app itself

Inside the app, the latest update, version 2.75.1, carries notes from Zomato that point to three additions: gift cards that can be sent with a chosen design and a personal message, a Comedy tab for browsing and booking stand-up shows, and a Salons tab for finding nearby salons and reserving an appointment. Zomato has used the same notes for earlier releases as well.

District is built around the evening out rather than the night in. According to Zomato's listing, it gathers movie tickets at chains such as PVR INOX and Cinepolis, concerts, comedy, cricket and festivals, and dining bookings, with offers attached to many of them. Prices are in rupees and the lineup is Indian cities and Indian venues, so it is of little use to anyone planning a night out elsewhere.