Amid valuation worries, grey market indicators suggest waning sentiment for Lenskart Solutions Ltd’s highly anticipated IPO. Data from Investorgain shows the grey market premium (GMP) has plunged in the past two days, from a peak of Rs 108 on Monday to Rs 48 on Wednesday, implying a potential listing gain of around 12%.
The issue earlier commanded a premium of nearly 27%. However, with valuation concerns spreading among investors and across social media, the unofficial market premium slipped to 18% on Tuesday and further to 12% by Wednesday. GMP provides reasonable insights into the expected listing price of an IPO. However, it is not a 100% true predictor.
Some market participants believe the eyewear startup has left little on the table for retail investors. Lenskart turned profitable only in FY25, posting a net profit of Rs 297 crore, while its Rs 70,000 crore valuation at the upper end of the price band translates to a steep 237 times price-to-earnings multiple.
Adding to concerns, just three months before the IPO, cofounder and chairman Peyush Bansal had reportedly taken a Rs 200 crore loan to purchase Lenskart shares at a Rs 8,500 crore valuation. Now, in November, he is offloading shares to the public and institutional investors at nearly nine times that valuation.
The Gurugram-based company will launch its IPO on October 31, with a price band fixed at Rs 382–402 per share. The Rs 7,278-crore public issue will close on November 4 while the one for anchor investors is scheduled for October 30.
Early backers like Softbank, Temasek, Kedaara and the promoters of Lenskart are eyeing massive windfall gains from the IPO.
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.
Topping the gainers' list is Bansal who holds 17.32 crore shares, acquired at an average cost of Rs 18.6/share, representing a 10.28% stake.
At the upper price band, Bansal’s holding is worth Rs 6,964 crore, a 20-fold gain on his pre–price-band holding, which was valued at Rs 323 crore when he acquired this stake. From the issue, he will be laughing his way to the bank with a Rs 823.66-crore cheque for selling 2.05 crore shares, translating into a return of 2,061% on his capital investment.
