Lenskart has approved the merger of two wholly owned subsidiaries with its parent company and announced a strategic joint venture with China-based Mingfeng Glassesworld Ltd (MGL) to manufacture metal spectacle frames in India.
The twin moves are part of Lenskart’s overall strategy to push for domestic manufacturing, improve supply chain efficiency, and increase localisation across its eyewear business.
According to a filing on the stock exchange, Lenskart’s board approved a Scheme of Amalgamation, and Dealskart Online Services Pvt Ltd and Lenskart Eyetech Pvt Ltd will be merged into Lenskart Solutions Ltd.
Both companies are wholly owned subsidiaries of Lenskart. The company said that the proposed amalgamation falls under schemes that are exempt from getting a No Objection Letter from the stock exchanges. The scheme and the related board resolution have been submitted to the exchanges for disclosure.
Lenskart Announces Joint Venture With Mingfeng
Lenskart's board approved the incorporation of a joint venture company in India with Mingfeng Glassesworld Ltd.
The proposed joint venture will manufacture metal spectacle frames in India. The partnership aims to build Lenskart’s manufacturing infrastructure in India and make it more efficient in order to source essential components for eyewear.
Metal spectacle frames are an important category for the eyewear market. An increase in domestic production might give Lenskart more control over manufacturing, quality standards, production timelines, and supply chain operations.
The partnership with Mingfeng will help the company to expand manufacturing capabilities and localise production, said a statement from the company.
Eliminate Import Dependence
A key objective of the proposed manufacturing project is to reduce Lenskart's dependence on imported metal spectacle frames.
The manufacturing of frames in India could shorten the company’s supply chain and reduce exposure to overseas sourcing disruptions. It can also enable Lenskart to react more quickly to changes in customer demand and product preferences.
Local manufacturing can provide increased visibility on production processes and inventory management. For eyewear businesses operating in such a big domestic market, these factors can be critical for product availability and cost management.
The initiative, however, also comes at a time when companies are turning their attention to domestic production and supply chain localisation in various industries.
Faster Production and Greater Supply-Chain Control
The proposed joint venture could offer Lenskart a greater degree of flexibility in managing production cycles. Moving product manufacture to its main market would also reduce the time needed to transport products from overseas facilities to Indian consumers.
Domestic production might also help the company respond to changing fashion trends and consumer tastes faster.
For Lenskart, this partnership could have a far-reaching impact beyond import substitution. It could build a more integrated domestic manufacturing ecosystem covering multiple stages of eyewear production.
The company would also enjoy better control over quality checks and manufacturing processes, and potentially improve cost management over the longer term.
Strategic Significance for Lenskart
Lenskart is still building its operational structure and manufacturing capabilities, and the new product will be very important.
The merger of Dealskart Online Services and Lenskart Eyetech with Lenskart Solutions will simplify the corporate structure of the group and bring the two wholly owned subsidiaries under the parent company.
At the same time, the proposed partnership with Mingfeng is a further step in Lenskart's manufacturing strategy.
The two developments are different, but they have in common the desire in the company to grow a more streamlined and locally integrated business.
As India’s organised eyewear market expands, control over manufacturing, sourcing, inventory and distribution could become increasingly important for large players.
The proposed joint venture with Mingfeng could provide Lenskart with another route to expand domestic production of metal spectacle frames and lessen its reliance on overseas suppliers.
It can also increase supply-chain resilience and the flexibility of the company as it expands its eyewear business in the Indian market.
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