SoftBank Offloads ₹2,873 Crore Stake in Lenskart to Goldman Sachs and Other Investors in Block Deal
SoftBank’s recent divestment from Lenskart Solutions, amounting to approximately Rs 2,873 crore through a block deal, marks a significant moment in the eyewear retailer’s financial landscape. The transaction involved the sale of 5.65 crore shares at a price of Rs 508.55 each, highlighting a strategic shift by SoftBank’s affiliate, SVF II Lightbulb (Cayman). This sale has attracted substantial participation from a diverse array of institutional investors, including major funds managed by prominent players such as Goldman Sachs, Fidelity, and various domestic mutual funds. The successful placement underscores strong confidence in Lenskart’s market potential following the exit of a key shareholder.
Recent analysis by Elara Capital has initiated coverage on Lenskart with a “Buy” rating and a target price of Rs 615, suggesting a 22% upside from its current valuation of Rs 504. This endorsement underscores Lenskart’s robust business model; characterized by a well-integrated approach that encompasses eye testing, manufacturing, distribution, and retail. The company’s store economics reveal a noteworthy revenue productivity of approximately Rs 25,000-30,000 per square foot, accompanied by gross margins nearing 69%, coupled with attractive payback periods of 10-12 months. Such metrics indicate a compelling operational efficiency, crucial in the competitive landscape of Indian retail.
Moreover, Lenskart’s ambitious growth trajectory, projected to deliver a revenue compound annual growth rate (CAGR) of 25% and an EBITDA CAGR of 38% from FY26 to FY29, forms a solid foundation for investor optimism. The strategic leverage of technology in its vision care services, contributing to around 600 eye tests per store per month, is pivotal to scaling its operations. With a goal of achieving 100 million annual eye tests, Lenskart’s commitment to innovation positions it favorably within its sector.
Additionally, Lenskart’s international expansion efforts, which now account for 42% of its revenue, further enhance its growth profile. The company’s acquisitions of Owndays and Meller, along with its extensive global footprint across more than 10 countries and over 600 stores, indicate a robust strategy aimed at diversifying revenue sources and reducing reliance on domestic markets. This diversified approach combined with strong operational metrics and projected growth reinforces Lenskart’s status as a formidable player in the retail eyewear sector, warranting close attention from Wealthova investors.
Source: The Economic Times
(Expert Note: This report was prepared by the Wealthova team.)