Daijiworld Media Network - Mumbai

Mumbai, Nov 28: In a strong vote of confidence for Lenskart Solutions Ltd, Jefferies India has initiated coverage on the tech-driven eyewear retailer with a ‘Buy’ rating and a target price of Rs 500 per share, signalling a potential 23% upside from its previous close. Following the report, Lenskart’s newly listed shares surged nearly 5% on November 28 to trade at Rs 428.90.

In an upbeat scenario, Jefferies projects the stock could climb even higher to Rs 560, indicating a robust 38% upside.

Despite being India’s largest organised eyewear player, Lenskart commands only about 5% of the country’s $9-billion eyewear market, which remains largely unorganised. Jefferies argues this leaves the company ample room for expansion.

Its vertically integrated value chain, coupled with an omni-channel presence, has strengthened Lenskart’s cost efficiency, customer experience and supply-chain speed factors that offer a major edge in a fragmented industry.

Jefferies expects India to continue as the “bedrock” of Lenskart’s performance, contributing over 85% of EBITDA, while its international operations add long-term scale opportunities.
Rapid store paybacks, strong unit economics, and premium pricing power are projected to push the company’s adjusted EBITDA growth above 50% CAGR between FY25 and FY28.
India’s eyewear industry is growing at 13% annually but remains significantly underpenetrated.

Prescription eyeglasses over 70% of the entire market are rising due to prolonged screen usage, pollution, increasing refractive errors and an ageing population.

With 2,100+ stores and growing, Lenskart leads the organised segment, yet its small overall market share suggests tremendous growth potential ahead.

A standout factor, Jefferies says, is Lenskart’s control over its entire ecosystem from manufacturing to retailing.

With production units in India, Singapore and Dubai, the company enjoys scale benefits.

Its “experience-centre” store model minimises capital expenditure and ensures quicker store profitability, with nearly 80% of outlets recovering costs within a year.

Jefferies estimates:

• 24% revenue CAGR for FY25–28

• 50%+ adjusted EBITDA CAGR

• 600 bps margin expansion

• 44% earnings per share CAGR

The brokerage notes Lenskart’s balance sheet remains net cash positive, with improving return ratios and free cash flow generation.

In a bearish scenario, Jefferies sets a target of Rs 320—a 21% downside—based on:

• A slower 16% revenue CAGR

• Pre-Ind AS EBITDA margins at around 12%

• A reduced valuation multiple of 42x on FY28 EBITDA

Key risks include rising competition, tech disruptions through smart eyewear, and weaker-than-expected demand trends.