Lenskart’s Rs 7,000 crore IPO under the spotlight: Experts weigh the pros and cons

Lenskart IPO

Lenskart's Rs 7,278-crore initial public offering has opened for bidding on October 31, and while concerns over valuations persist, indicative grey market premium is signalling at a decent listing for the eye-wear retailer.

Several analysts have a mixed review of Lenskart’s public issue, highlighting the strong brand and marque investors as well as the stretched valuations.

Lenskart IPO GMP

Ahead of listing, the unlisted shares of the company were trading with 18.41 percent grey market premium (GMP) over the IPO price, as per Investorgain. This has risen slightly from the 17.41 percent quoted by the site on October 30.

According to IPO Watch, the unlisted shares of the company were trading with 11.45 percent GMP over the IPO price.

Analyst View

The Lenskart IPO, backed by marquee investors, has seen high market interest, said Shravan Shetty, Managing Director at Primus Partners, a fund raising platform. Billionaire businessman and investor Radhakishan Damani has invested around Rs 90 crore in the company during a pre-IPO funding round.

Primus’ Shetty said the decent GMP despite elevated valuations indicates the market is looking at it more as a technology company that can scale rapidly.

"With a possible valuation of close to Rs 70,000 crore, the omni-channel reach and aggressive international expansion are obvious differentiators. But what investors will have to examine is sustainability - whether its unit economics and margins are able to endure increasing operational costs and international competition," said Siddharth Maurya, Founder & Managing Director at Vibhavangal Anukulakara.

"While the eyewear segment provides India's under-penetrated optical market with long-term growth opportunities, sustained profitability and capital prudence will decide if Lenskart matures from a high-growth startup into a sustainable listed business," Anukulakara added.

Shivani Nyati, Head of Wealth at Swastika Investmart has a ‘Neutral’ rating for Lenskart owing to stretched valuations despite solid fundamentals.

'Best suited for investors with a higher risk appetite'

Choice Broking has assigned a 'Subscribe for Long Term' for the IPO, highlighting its strong growth potential but higher valuation and profitability risks. The brokerage added that the offering is best suited for investors with a higher risk appetite and a long-term investment horizon.

"At the upper end of its price band, LSL is valued at an EV/Sales of 9.9× (TTM basis), which appears significantly high. While the company has posted steady topline growth, profitability remains weak, with a positive PAT mainly driven by other income and lower expenses. LSL holds a 4-6 percent market share in the prescription eyewear segment, dominated by unorganized players. Its average revenue per store has improved from Rs 1.9 crore to Rs 2.4 crore, supported by operational efficiencies and AI-driven technologies. Billionaire investor Radhakishan Damani has invested around Rs 90 crore in the company during its pre-IPO funding round. About 40% of its revenue comes from international markets," Choice Broking said.

HDFC Securities said Lenskart has positioned its eyewear portfolio as both functional and fashionable lifestyle products. "The Company invests strategically to maintain brand relevance, especially for Gen-Z and younger consumers, through digital marketing campaigns, influencer endorsements, television advertising, and social media content strategies, with a focus on international markets. Lenskart continues to innovate store designs to enhance brand appeal and customer experience," the note said.

Lenskart is no longer a startup story — it’s a mature consumer-tech play commanding premium multiples typically reserved for category leaders, said Harshal Dasani, Business Head, INVasset PMS.

Key Concerns

In markets like India and South-east Asia, 70-77 percent of eyewear retail is unorganised, often fragmented with inconsistent quality, pricing opacity and limited product assortment. HDFC Securities has listed out price fluctuations or quality issues from raw material suppliers, Chinese links, failure to maintain or improve capacity utilization, heavy dependence on Gurugram industrial cluster as among the key risks for investors.

The company’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, Dasani said.

"At these levels, near-term upside may be limited unless profitability accelerates faster than expected. Over the medium term, investors betting on Lenskart are essentially backing its ability to evolve from a high-growth retailer into a cash-generating consumer brand with global scale. The company’s next phase will determine whether Rs 70,000 crore marks a justified premium — or the upper bound of optimism," he added.

Follow all IPO news here.

About Lenskart IPO

Lenskart is looking to raise Rs 7,278 crore through a fresh issue of shares worth Rs 2,150 crore and an offer for sale of 12.75 crore shares. The IPO will remain open for public bidding between October 31 and November 2. At a price band of Rs 382-402 per share, the company seeks a valuation of around Rs 70,000 crore.

Investors can bid for a minimum of 37 shares, requiring an investment of Rs 14,874, and in multiples thereafter. The allotments are likely to be declared on November 5, and the shares are scheduled to be listed on stock exchanges on November 10.