Lenskart Solutions Limited Makes Weak Debut with 10.21% Decline, Lists at ₹360.95 Against Strong Subscription

Lenskart Solutions, a technology-focused eyewear company established in 2008 involved in design, manufacturing, branding, and retail of prescription eyeglasses, sunglasses, contact lenses, and accessories, recording highest volume of prescription eyeglasses sold in India during FY 2025, operating 2,723 stores globally including 2,067 in India and 656 overseas with 1,757 owned and 310 franchised stores, centralised manufacturing in Bhiwadi and Gurugram with regional facilities in Singapore and UAE enabling next-day delivery in 40 Indian cities and over 100 million cumulative app downloads.

Lenskart Solutions Limited Listing Details

Lenskart Solutions launched its IPO at ₹402 per share with minimum investment of 37 shares costing ₹14,874. The IPO received strong response with subscription of 28.27 times - retail at solid 7.56 times, QIB at impressive 40.36 times, and NII at strong 18.23 times (bNII at 21.81 times and sNII at 11.06 times), indicating substantial institutional and retail confidence despite concerns about premium valuation in the eyewear retail sector.

First-Day Trading Performance

Listing Price: Lenskart Solutions opened at ₹390.00 representing decline of 2.99% from issue price of ₹402.00, fell further to ₹360.95 (down 10.21%) with intraday low at ₹355.70 (down 11.52%) and VWAP at ₹374.79, delivering significant losses of ₹41.05 per share reflecting highly negative market sentiment about exorbitant valuation despite strong business fundamentals.

Growth Drivers and Challenges

Growth Drivers:

Market Leadership with Omnichannel Presence: Highest volume of prescription eyeglasses sold in India during FY 2025, 2,723 stores globally with 2,067 in India, direct-to-consumer model with owned brand portfolio, 105 new collections launched in FY 2025 including collaborations, remote eye testing through 136 optometrists at 168 stores, over 100 million app downloads.

Integrated Manufacturing and Technology: Centralised supply chain with in-house manufacturing in Bhiwadi and Gurugram, regional facilities in Singapore and UAE, next-day delivery in 40 Indian cities and 3-day delivery in 69 cities, 532-member tech team, technology-led operations and retail experience.

Strong Revenue Growth: Revenue increased 25% between FY24 and FY25, exceptional PAT growth of 3028% turning profitable from losses, revenues of ₹6,652.52 crore in FY25 from ₹5,427.70 crore in FY24, solid EBITDA margin of 14.60%, ROCE of 13.84%.

Challenges:

Exorbitantly Aggressive Valuation: Post-issue P/E of 284.96x appearing exorbitantly priced for eyewear retailer, pre-issue P/E at astronomical 227.27x, price-to-book of 11.03x, expert review describing issue as "exorbitantly priced" asking "fancy premium" for aggressive future plans, recommending only for well-informed/cash surplus/risk seekers.

Large Offer for Sale Component: Total issue size of ₹7,278.76 crore with offer for sale of ₹5,128.02 crore (70.4% of total) versus fresh capital of ₹2,150.74 crore, promoter stake reducing from 19.85% to 17.52%, substantial selling by existing investors raising concerns about exit timing.

Utilisation of IPO Proceeds

Store Expansion: ₹272.62 crore for capital expenditure towards setup of new CoCo stores in India and ₹591.44 crore for lease/rent payments for CoCo stores expanding retail footprint.

Technology and Marketing: ₹213.38 crore investing in technology and cloud infrastructure, ₹320.06 crore for brand marketing and business promotion enhancing brand awareness.

Strategic Flexibility: ₹683.13 crore for unidentified inorganic acquisitions and general corporate purposes. Additionally, ₹5,128.02 crore through offer for sale by existing shareholders.

Financial Performance

Revenue: ₹6,652.52 crore for FY25, growth of 25% from ₹5,427.70 crore in FY24, reflecting expanding eyewear retail operations.

Net Profit: ₹297.34 crore in FY25, exceptional turnaround from loss of ₹10.15 crore in FY24, demonstrating operational improvements.

Financial Metrics: Solid ROCE of 13.84%, RoNW of 4.84, EBITDA margin of 14.60%, price-to-book of 11.03x, post-issue EPS of ₹1.41, P/E of 284.96x, and market capitalisation of ₹62,620.14 crore