While the company has been using the name internally for two years, the public announcement and new logo suggest a desire to signal more than just a name change.
“This isn’t just a name change; it is a mission statement. A reminder etched into our identity that we will endure — not because we are here, but because we need to get there,” Deepinder Goyal said in the letter.
Upon approval, Zomato’s corporate website will transition from zomato.com to eternal.com, and its stock ticker from ZOMATO to ETERNAL. Eternal will comprise four major businesses for now – Zomato, Blinkit, District, and Hyperpure, Goyal said in the note.
So, what really changes? Nothing much, really. “The Zomato brand remains intact. Only the holding company name will change. They want their other brands like Blinkit to stand on their own feet under an umbrella corporation much like Alphabet (which owns the brand Google),” said Bharadwaj Jaishankar, partner at IndusLaw.
Companies undertake identity shifts for various strategic reasons, from mergers and acquisitions to evolving business strategies, tarnished reputations, or the desire to attract a new target audience. “Sometimes, they would change names to gain media attention as well,” Jaishankar pointed out.
The Vodafone Idea merger, creating a telecommunications giant, exemplifies a name change driven by consolidation. Conversely, DB Realty’s new identity, Valor Estate, reflects its strategic shift towards a more trusted brand image associated with innovation, sustainability, and customer focus.
This trend of identity transformations is significant, with over 1,100 Indian companies adopting new names in the past two decades. These changes range from minor tweaks, like dropping a word, to complete overhauls or even changing colour schemes of their logos to target a particular class of customers.
While recent years have seen a steady pace of around 70 name changes annually, 2010 witnessed a peak of 101 such transitions, showed a Mint analysis of Capitaline data.
In terms of sector representation, companies in the banking, financial services, and insurance (BFSI) sector accounted for the largest share of name changes (approximately 16%), showed the analysis. Construction and real estate companies followed with 8.4% share, while the information technology sector represented 7.4%. The power and oil & gas sector had the lowest share, at only 1%.
Quick change artists
While corporate identity changes are a familiar corporate manoeuvre, a striking trend is emerging in the public market: a significant number of newly listed companies are swiftly revamping their brand identities.
Is the intense pressure to differentiate themselves in the crowded marketplace the primary driver? Mint analysis suggests this could be one of the factors, revealing that over a third of companies change their identities within just five years of their initial public offering (IPO). This underscores the strategic importance of brand evolution in the crucial post-IPO phase. Zomato’s name change comes after less than four years of its listing on the Indian bourses.
The Mint analysis further reveals that name changes aren’t limited to the immediate post-IPO period. Around 7% of firms opted for a new name between six and ten years after listing, while another 10% did so between eleven and fifteen years. This data indicates that brand evolution remains a relevant consideration for companies even as they mature in the public market.
“At the end of day rebranding is an exercise, for amongst other reasons, to stay relevant and known. Mature companies keep refreshing their logos every now and then for this reason,” Jaishankar said. “Even though it is a cosmetic makeover on the surface, it signifies a strategic shift underneath which involves months of preparation and approval from stakeholders.”
Interestingly, identity transformation isn’t always a reaction to public listing; it can also be a proactive pre-listing strategy. Swiggy’s recent name change from Bundl Technologies Pvt Ltd to Swiggy Pvt Ltd, ahead of its anticipated IPO, for ‘brand proximity’ exemplifies this trend.
Also Read: Swiggy Instamart picks up pace but still lags Zomato’s Blinkit
Price correlation
However, no matter what a company’s motivations are, stock prices have traditionally reacted positively to rebranding, the analysis showed. In 2024, stocks of 30 companies offered positive median returns on and after the day of their name changes. However, experts pointed out that there is hardly any correlation between a company’s rebranding and its stock price movement. “Usually, stocks react only if there is any value proposition for the investors in the rebranding. Like if the company is launching a new sub brand or going for a merger or acquisition,” highlighted Raghav Manohar Narsalay, partner and leader at research and insights hub at PwC India.
Also Read: Small restaurants, cloud kitchens heating up competition: Rakesh Ranjan, CEO, Food Delivery, Zomato
