Post by : Badri Ariffin

On Monday, Lenskart shares experienced a remarkable market debut, initially dipping before closing slightly above their IPO price, showcasing significant investor interest amid market fluctuations. The prominent Indian eyewear brand successfully raised ₹72.8 billion ($821 million) in a listing that quickly sold out, stirring conversations regarding its ambitious valuation.

Opening at ₹395, below the IPO price of ₹402, the stock slid down by as much as 11% to ₹356.10 during trading. Nevertheless, it managed to bounce back, finishing the day at ₹404.55, thereby valuing the company at about ₹702 billion ($8 billion). The IPO was met with exceptional demand, oversubscribed nearly 28 times, largely due to institutional investors.

With 15 years in operation, Lenskart champions a vertically integrated business model, managing all facets from manufacturing to retail. This strategy, the company asserts, offers a competitive edge over traditional optical retailers and up-and-coming online rivals. However, it contends with fierce competition from brands like Titan Eye+ and newer direct-to-consumer entrants, prompting scrutiny regarding its growth trajectory both domestically and internationally.

Financially, Lenskart recorded a profit for the fiscal year 2025 ending in March, with revenues climbing 23% year-on-year to ₹66.53 billion ($750 million). The net profit reached ₹2.97 billion ($33 million), aided by a ₹1.67 billion ($19 million) accounting gain from the acquisition of Owndays. Excluding this one-off gain, the core profit remained around ₹1.30 billion ($15 million).

At the high end of its IPO target, Lenskart sought a valuation of ₹700 billion ($7.9 billion), situating it among India’s leading new-age consumer brands alongside Honasa and BlueStone. This valuation reflects a 60% increase from last June's secondary share sale with late-stage investors like Fidelity and Temasek, implying approximately 230 times core net profit and 10 times revenue, igniting discussions among retail investors.

During the IPO ceremony, CEO Peyush Bansal highlighted the company's mission over mere valuation, stating, “We didn’t build Lenskart to reach a valuation. We did it to reach people, from Delhi to the smallest towns of India.”

The funds raised through the IPO will be utilized by Lenskart to broaden its retail network, enhance its supply chain, invest in technological advancements and marketing strategies, and explore acquisitions. Existing investors, such as SoftBank, Schroders Capital, Premji Invest, Kedaara Capital, and Alpha Wave Ventures, alongside co-founders and executives, divested parts of their holdings during the listing.

Lenskart’s IPO emerges amid a surge of Indian startups eyeing public markets, as tightening late-stage venture funding converges with a rising interest from domestic investors. Companies like Groww, Pine Labs, PhysicsWallah, Capillary Technologies, and BoAt are also gearing up for public offerings in the forthcoming months.

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