Lenskart shares rose more than 2% in early morning trade on Friday after Motilal Oswal Financial Services initiated coverage on the company with a ‘Buy’ rating and a target price of ₹600.
In its report, the brokerage said Lenskart has built durable moats in a category that is otherwise difficult to scale. It expects the company to deliver a revenue CAGR of 25% between FY25 and FY28. EBITDA is projected to grow at a CAGR of 53% over the same period, driven by operating leverage and expanding scale.
Motilal Oswal noted that near-term free cash flow generation may remain constrained due to upfront capital expenditure related to the upcoming Hyderabad facility. However, it expects free cash flow to improve to 65–70% of pre-Ind AS EBITDA beyond FY28.
The brokerage acknowledged that the stock trades at a premium compared to other leading retailers. However, it said the valuation is supported by the company’s growth outlook and structural positioning.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.