Is Lenskart IPO Worth Your Money? Full Reality Check!

Key Takeaways

• IPO size: ₹7,278 crore (₹2,150 crore fresh issue + ₹5,128 crore OFS)
• Valuation: Extremely high – P/E above 200x, EV/Sales near 10x
• Profit quality: FY25 profit inflated by a one-time non-cash gain
• Strengths: Strong brand, omnichannel presence, investor confidence
• View: Solid business, but valuations look stretched → Neutral rating.

A Stylish IPO with a Price Tag to Match

Lenskart Solutions Ltd., founded in 2008, has transformed from an online eyewear seller into India’s largest tech-enabled eyewear retailer. With over 2,723 stores across India and overseas, the company manufactures, designs, and retails prescription glasses, sunglasses, and contact lenses through its own platform and app (over 100 million downloads).

After years of steady growth, Lenskart turned profitable in FY25 with a net profit of ₹297 crore and an EBITDA margin of 13.85%, up from 11.98% in FY24. The company’s revenue jumped 22.6% YoY to ₹6,652 crore, showing strong operating momentum.

But is that enough to justify its ₹70,000 crore market cap? Let’s break it down.

IPO Details at a Glance

Where the Money Will Go

The company plans to use the IPO proceeds for:

• Expanding company-owned stores (CoCo model) and meeting related lease costs.
• Investing in technology infrastructure, cloud systems, and marketing.
• Acquisitions and general corporate purposes.

Why Investors Are Interested

1. India’s Eyewear Market = Huge Opportunity

India’s eyewear industry is under-penetrated, with a large unorganized segment. Lenskart’s direct-to-consumer approach, backed by tech-driven supply chains and omnichannel reach, gives it a strong foothold in this expanding market.

2. Strong Brand Recall

With affordable yet trendy eyewear, Lenskart enjoys strong customer loyalty, particularly among millennials and Gen Z consumers.

3. Veteran Investor Backing

The entry of Radhakishan Damani, a respected market veteran, has boosted confidence among investors and analysts alike.

The Flip Side: Why You Should Be Cautious

1. Aggressive Valuation

Lenskart’s valuation metrics are sky-high.

• P/E: 200x+
• EV/Sales: ~10x

At these levels, the stock is priced for perfection, leaving minimal room for error if growth slows or margins shrink.

2. Profit Quality Concerns

FY25’s ₹297 crore profit primarily came from a one-time non-cash accounting gain, raising questions about the sustainability of earnings in future periods.

3. High Dependence on China

Over 40% of raw material and component sourcing is tied to Chinese suppliers via joint ventures, exposing the company to geopolitical risks and supply disruptions.

4. Competitive Pressure

Competition is rising from both online and offline eyewear players, including Titan’s Eye+ and new D2C startups. Maintaining growth while preserving margins could be challenging.

Market Context: Why It Matters

The Lenskart IPO arrives at a time when investor appetite for consumer tech companies is strong, but valuations are under scrutiny. With peers like Mamaearth and Boat facing post-listing volatility, investors are becoming cautious.

The company’s ₹7,278 crore issue, where 70% of funds (OFS) go to existing shareholders, signals that much of the offer is an exit opportunity for early investors rather than a pure growth capital raise.

Swastika Investmart’s View

Swastika Investmart has assigned a Neutral Rating to the Lenskart IPO.
The business fundamentals are solid — large customer base, strong brand, scalable tech model — but valuation comfort is missing.

For long-term investors, it may be worth watching post-listing performance before taking exposure.

FAQs

1. What is the Lenskart IPO price band?
The price band is set between ₹382 and ₹402 per share.

2. How much of the IPO is fresh issue?
₹2,150 crore is a fresh issue, while ₹5,128 crore is an offer for sale by existing shareholders.

3. Is Lenskart profitable?
Yes, the company turned profitable in FY25 with ₹297 crore net profit, though most of it came from a one-time accounting gain.

4. What is Swastika’s recommendation?
Swastika Investmart gives a Neutral rating — strong business, but valuations are on the higher side.

5. Should retail investors apply?
Apply only if you believe in long-term growth potential and can tolerate near-term valuation risk.

Conclusion

Lenskart’s IPO brings together a powerful mix of brand strength, tech-driven growth, and a booming consumer market. However, the steep valuation and profit quality concerns make it a case of “great company, expensive price.”

For investors looking for balanced, research-backed guidance and reliable support, Swastika Investmart offers SEBI-registered expertise, strong research tools, and tech-enabled investing platforms to help you make informed decisions.

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