NEW DELHI: The initial public offering (IPO) of eyewear major Lenskart Solutions received 28.26 times subscription on the final day of bidding, highlighting confidence investors have in the Indian primary market and in the company despite valuation concerns. The Rs 7,278-crore IPO received bids for over 281 crore shares at the end of Tuesday's bidding session, as against 9.97 crore shares on offer, as per BSE data.
Lenskart’s IPO garnered bids worth over Rs 1.1 lakh crores. Earlier this year, LG Electronics’ initial share sale broke all records and drew bids worth Rs 4.43 lakh crore at the top end of its price band.
The portion for Retail Individual Investors (RIIs) part for Lenskart’s IPO fetched 7.54 times subscription, while the non-institutional investor category got subscribed 18.23 times. The quota set aside for Qualified Institutional Buyers (QIBs) received 40.35 times the subscription.
According to the unofficial grey market activity, the shares of Lenskart are commanding a premium of over 12 percent, indicating a listing gain of Rs 49 per share. The IPO price was fixed at Rs 382–402 per share. The issue consists of Rs 2,150 crore worth of fresh issue and the rest in secondary issuance by promoters and external investors like the Japanese powerhouse Softbank, the Singaporean sovereign wealth fund Temasek, and private equity player Kedaara Capital among others.
Lenskart’s valuation concerns stem from its high P/E. The Gurugram-based company turned profitable in FY25, posting a net profit of Rs 297 crore and its Rs 70,000 crore valuation at the upper end of the IPO price band translates to a steep 237 times price-to-earnings multiple.
This, according to many, makes the IPO a highly ‘expensive’ affair. Harshal Dasani, Business Head, INVasset PMS said that Lenskart’s forward valuation implies over 200 times current earnings, making it one of the most expensive listings in India’s digital retail space.
“The real question isn’t whether Lenskart deserves this valuation, but whether it can grow into it. With revenues rising sharply in FY24 and losses narrowing, the company’s omni-channel strategy, private-label dominance, and global expansion give it credible growth levers. However, sustaining 30–40 percent revenue growth while expanding margins in a competitive eyewear market will be critical to support such rich pricing,” added Dasani.
Experts also cited that while Lenskart’s valuation concerns are valid, the company’s dominant market position seems to have attracted investors. They also cited the positive momentum India’s primary market is currently going through.
As per Prime Database, the primary market in India is witnessing a massive surge with over Rs 1.13 lakh crore worth of IPOs lined up for November and December. In October, the IPO market raised as much as Rs 46,000 crore.
Besides Lenskart, stock brokering and investment firm Groww has opened its IPO for subscription. The IPO of Billionbrains Garage Ventures, the parent company of Groww, was subscribed to 57 percent on day 1 (Tuesday). The RII portion was subscribed 1.91 times and the NII portion has been booked 59 percent. The Qualified Institutional Buyers (QIBs) portion received only 10 percent bids on day one.
