Hi Vikas,
You have to think this scenario like a Tree.
Segmentation Basis are the trunck.
Segments are branchs
and Target groups are leafs.
Our main objetive is the final point, the target groups but, we can also to use Segments that involves more than one target groups with the same functional meaning.
This is as Jorge Ariño sais, you can use leafs(target groups) but, sometimes, you need to get something more generic, then you can use branchs (segments).
I hope that helps.
Regards.