However, the revenue projection for 2020-21 are a significant drop for the company, which has historically recorded 40%-50% growth year-on-year till fiscal 2019.
SoftBank-backed Lenskart Eyewear Solutions has projected a 20% growth in sales in the current financial year, at a time when the ongoing Covid-19 pandemic has brought consumer businesses in India to their knees.
However, the revenue projection for 2020-21 are a significant drop for the company, which has historically recorded 40%-50% growth year-on-year till fiscal 2019. It is yet to file its financials for fiscal 2020.
“At a time like this, we are still hoping to record a 20% growth in business for financial year 2020-21… It is obviously not as much as we have usually recorded in the past, and is certainly not going to be in the 40%-50% revenue growth range that we anticipated earlier, prior to the pandemic,” Peyush Bansal, chief executive of Lenskart, told ET.
Lenskart’s sales are being driven primarily through the company’s website and mobile app. The split between online and offline sales are currently in a ratio of 90:10, according to Bansal, whereas pre-Covid-19, it was typically recording a ratio of 70:30 in favour of sales through its 600-plus stores.
The Faridabad-based eyewear solutions company, which had to shutter its retail outlets across the country, as the nation went into a lockdown to combat the pandemic, has reopened about 100 stores over the last one week, which are located in green zone designated areas, and expects prescription glasses and contact lenses to drive revenue for the ongoing fiscal.
“There is a demand for quality affordable eyewear, and we are the only ones that can provide it to you online, at home, as well as in the store, while ensuring all safety precautions are in place, and at scale,” Bansal said.
The company, which sold about 6 million pairs by the end of March 2020, is anticipating sales of about 7 million pairs by the end of the current fiscal, with demand picking up third-quarter onwards.
According to Bansal, the company is also projecting opening an additional 200 stores through the course of the current financial year.
“We want to add at least another 200 stores this year. The model will change. Instead of a fixed rental, we are looking to enter into a revenue-share with potential landlords…We are working on the locations for new store openings right now. They will be spread across a combination of tier-1 and tier-2 cities,” Bansal said.
The opening of new stores comes at a time when global ratings agencies have continued to slash economic growth projections, for Asia’s third-largest economy, citing the shocks to the system triggered by the Covid-19 pandemic.
Last month, Fitch Ratings hacked India's GDP growth to 0.8% in the current fiscal, stating an unparalleled global recession was underway due to disruptions caused by the outbreak of covid-19 pandemic and resultant lockdowns, adding that the slump in growth was mainly due to a projected fall in consumer spending to just 0.3% in FY21.
“We, fortunately, are in a business which is a necessity… Retail will, and is, going through a tough time, but it also depends on the category in which you’re operating… While consumption has taken a hit, people continue to need affordable eyewear. We have a speciality there, and we need to serve this demand,” Bansal said.
The offline stores are primarily serving as eye test centres for customers
“Almost 60% of the country’s population needs vision correction. People need their glasses. That problem is not going away. The stores are not just points of sale for us. While the Covid-19 may linger for some more time, there is a time after that as well,” Bansal said.
The CEO also said that there are no plans to raise further capital from investors, as the company is “well capitalised” and continues to keep its burn rate under control.
“We have also been fortunate, because we had raised financing right before the outbreak of the pandemic. Otherwise, the situation could have quite different. This definitely allows us to cruise.” Bansal said.
In 2019, Lenskart had raised an estimated $330 million in quick succession from SoftBank’s Vision Fund-II and home-grown private equity major Kedaara Capital, in a mix of primary and secondary transactions, and which catapulted it into the unicorn club.
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