Motilal Oswal has reiterated its “Buy” rating on Lenskart following the company’s strong Q4FY26 performance, while raising its target price to ₹650 from current levels, implying an upside potential of around 34%.
The brokerage termed Lenskart a “high conviction buy” and said the eyewear company is entering a structural compounding phase, supported by sharp margin expansion, premiumisation, operating leverage and improving international profitability.
According to Motilal Oswal, Lenskart posted a “massive” beat in the March quarter, with revenue rising around 41% year-on-year, while pre-Ind AS EBITDA doubled compared to the same period last year. The performance was driven by strong volume growth, a richer product mix, and operating leverage benefits.
The brokerage highlighted that FY26 marked a major step-up year for the company, with revenue growth accelerating to nearly 32% year-on-year compared to 23% growth in FY25. EBITDA surged approximately 96% during the year, accompanied by around 370 basis points of margin expansion.
Motilal Oswal noted that incremental revenues are now translating into disproportionately higher EBITDA and profit growth, reflecting the benefits of increasing store density, backward integration, supply-chain efficiencies, and technology-led execution.
The brokerage also pointed to faster-than-expected profitability in Lenskart’s international operations, which it believes further strengthens the company’s long-term earnings trajectory.
Management has reiterated its long-term EBITDA margin aspiration of around 25%, which Motilal Oswal believes leaves significant room for future earnings compounding as scale benefits continue to improve.
Following the strong Q4 performance and improving visibility on growth and profitability, the brokerage has raised its FY27 and FY28 EBITDA estimates by around 15% and 10%, respectively.
Motilal Oswal said the revised target price of ₹650 is backed by stronger growth visibility, sustained margin expansion and improving operational efficiency across domestic and international markets.
Disclaimer: This article is for informational purposes only and should not be construed as investment advice.