Global brokerage Goldman Sachs has initiated coverage on eyewear retailer Lenskart Solutions Ltd with a 'Buy' rating, citing the company's strong growth prospects, expanding retail network and vertically integrated supply chain as key drivers of long-term value. The brokerage has set a 12-month price target of Rs 635, implying an upside of about 20% from the current price of around Rs 526.
Goldman Sachs said Lenskart is well positioned to tap into India's fast-growing eyewear market, which remains significantly underpenetrated. According to the brokerage, nearly 35% of India's population requires vision correction, but access to organized eyewear retail remains limited. This gap provides a long runway for growth as consumers gradually shift from the unorganized market to branded and organized retailers.
The brokerage also highlighted Lenskart's rapid retail expansion. The company plans to increase its store network from around 2,060 stores in FY25 to more than 3,400 by FY28, which could help drive market share gains. Notably, about 80% of the company's PIN codes currently do not have a Lenskart store, suggesting further scope for geographic expansion.
Integrated Supply Chain Strengthens Competitive Moat
Goldman Sachs noted that Lenskart's vertically integrated supply chain gives it a significant edge over competitors in the fragmented eyewear industry.
The model allows the company to control manufacturing, logistics and retail distribution, enabling competitive pricing, faster delivery and broader product availability.
The brokerage also pointed to Lenskart's digital capabilities as a key differentiator. Features such as remote optometry, virtual try-on technology and strong customer engagement through its app help improve user experience and drive repeat purchases.
These technology-led tools also allow the company to scale efficiently while maintaining lower customer acquisition costs.
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Global Expansion Adds Growth Layer
Beyond India, Lenskart is expanding internationally through its OwnDays and Lenskart brands, targeting markets across Japan, Southeast Asia and the Middle East.
Goldman Sachs highlighted Singapore as a successful example of the company's overseas strategy, where Lenskart has emerged as a market leader within eight years of entry.
The brokerage believes Lenskart's integrated supply chain and technology-led operating model can support both market share gains and margin expansion in international markets.
Margin Expansion in Focus
Goldman Sachs expects around 500 basis points of EBITDA margin expansion between FY25 and FY28, driven by supply chain integration, improved store productivity and operating leverage as the business scales.
The brokerage projects revenue and EBITDA to grow at roughly 27% and 56% compound annual rates, respectively, over the same period.
Given its growth profile and expanding competitive advantages, Goldman Sachs values Lenskart at about a 30% premium to its consumer discretionary retail coverage, reflecting its stronger growth trajectory and improving profitability outlook.
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