Meanwhile, brokerages had mixed views on the stock, with Jefferies raising its price target and HSBC and Citi having its “hold” and “neutral” ratings.
Q1 Results
Its June quarter revenue increased 43.3% to ₹2,714.18 crore from ₹1,894.46 crore last year. Its profit after tax (PAT) surged to ₹228.43 crore from ₹61.17 crore in the previous fiscal.
The company’s earnings before interest, taxes, depreciation and amortization (EBITDA) increased 75.1% to ₹588.48 crore from ₹336.08 crore, while its margins expanded to 21.7% from 17.7% in the year-ago period.
Its India business revenue increased 30.9% to ₹1,530.82 crore, EBIT was up 53.3% at ₹183.28 crore while margins expanded to 12% from 10.2% in the previous year.
Meanwhile, its international business revenue increased 63.4% to ₹1,203.29 crore, EBIT increased to ₹103.67 crore from a loss of ₹11.4 crore last year and its margins were at 8.6%.
Lenskart Solutions’ eye tests increased 39.8% to ₹0.7 crore in the June quarter, while its India same store sales sales growth (SSSG) was at 18.3%.
Its volumes increased 25.7% while its India average selling price (ASP) grew 6.4% to ₹1,856 from last year.
The company added 132 net new stores in the June quarter taking the total to 3,459 stores.
Brokerages
Jefferies
Jefferies has a “buy” rating on Lenskart and has raised its target price to ₹680 per share from ₹600. This indicates an upside of 16% from its previous close.
It said the June quarter continues to build the story, with strong growth and sharp margin expansion.
Market creation remains a top priority, with supply, rather than demand, being a key constraint in India, evidenced by 70,000 daily eye tests, the brokerage said.
The company now plays at the bottom end with a fully-loaded 500 crore product, while a clear premiumization trend is visible, it said.
The company’s margin improvement in the international segment should put a key investor concern to rest. The brokerage added tha Meller could be the Ray-Ban of future.
HSBC
HSBC has a “hold” rating and a target price of ₹575 per share, which is 1.9% lower than its previous closing price.
It said the company’s 8% beat on consensus EBITDA was driven by the international segment, while the India one was in-line.
It said the India estimates are unchanged and international performance drives the upgrade in overall estimates — 6%for FY27, 5% for FY28 EBITDA.
HSBC said premium multiples is of 45 times and 30 times for the FY30 enterprise value and EBITDA factor potential, respectively.
Citi
The brokerage has a “neutral” rating on Lenskart Solutions with a target price of ₹650 per share, which is nearly 11% higher than the previous closing price.
It said the company reported another strong quarter on growth and profitability in India and international segments, which were broadly in-line with Citi estimates.
It said it expects growth momentum to remain strong as Lenskart continues to straddle across price points to accelerate store expansion, customer acquisition and conversion.
Citi said it will watch for growth momentum in the second half of this year, given the high base.
The brokerage said Lenskart execution remains strong on all parameters — store expansion, SSG and profitability, margins. However, it believes the current valuations are already pricing in growth and margin improvement trajectory and hence limit upside potential.
Stock reaction
Of the 21 analysts who have coverage on Lenskart Solutions, 17 have a “buy” rating, three have a “hold” rating and one has a “sell” rating.
Shares of Lenskart Solutions gained 6.5% to hit its intraday and 52-week high of 626.95 apiece. This is also the first time the stock has crossed the ₹600 levels.
The stock is up 55.9% from its issue price of ₹402 apiece, while it ahs gained 11.2% in the past month and 36.7% this year, so far.
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