Morgan Stanley lifts Lenskart target price on stronger India margin outlook

Morgan Stanley raised Lenskart’s target price to Rs 718 from Rs 666, retaining an overweight rating. The brokerage lifted India EBITDA margin estimates by 20–40 basis points while leaving India revenue estimates unchanged.

By ·Devil's-advocate pass

Source published First seen Source NDTV Profit

The development

Morgan Stanley raised Lenskart's target price to Rs 718 from Rs 666, maintaining an overweight rating. It lifted India EBITDA margin estimates by 20-40 basis points while leaving India revenue estimates unchanged.

The numbers

  • Rs 666
  • Rs 718
  • 6.53%
  • 0-2%
  • 3-7%
  • 20-40 basis points
  • 1- 5%
  • 24%
  • 19%
  • 270%
  • 4x
  • Rs 222 crore
  • Rs 60 crore
  • 43%
  • Rs 2,714 crore
  • Rs 1,894 crore
  • 76%
  • Rs 588 crore
  • Rs 335 crore
  • 21.7%
  • 17.7%
  • Rs 10.4 crore

Why it matters to operators and investors

The margin-led target-price increase makes the sustainability of Lenskart’s India profitability gains a key diligence question when using it as an eyewear valuation benchmark.

What to watch next

  • Reported India EBITDA margin versus the revised expectations, excluding one-off benefits.
  • Gross-margin and operating-expense trends that distinguish structural efficiencies from deferred spending.
  • Same-store growth, discount intensity and customer-acquisition spending.
  • New-store costs, capital expenditure and operating cash conversion.
  • Broader analyst earnings revisions rather than target-price changes alone.
  • Expect investors to prioritize the source and durability of India margin gains over headline revenue growth.
  • Watch for management to signal whether incremental profitability will be retained or reinvested in customer acquisition and expansion.
  • Peer analysts may revisit earnings estimates, while competitors could respond if Lenskart converts efficiencies into sharper pricing.

The counter-case

With India revenue forecasts unchanged, the upgrade reflects expected profitability gains, not stronger demand. The 20–40 basis-point margin improvement could be eroded by discounting, customer-acquisition costs or new-store ramp-up expenses. A higher target price does not establish attractive upside without the current share price.