The Lenskart Solutions IPO has entered Day 2 of subscription. Despite the concerns over valuations, Lenskart’s IPO was able to get its issue subscribed fully on the first day (October 31) itself. The retail and QIBs led the subscription book. The retailers booked the issue 1.32 times, the employees booked it 1.10 times, and the QIBs booked the issue 1.42 times (the highest on day 01). The big question now is whether it will deliver listing gains for the investors.
Is Lenskart the next big D2C listing, or another Paytm moment? In this context, often a similarity is being drawn between the Lenskart issue and the Paytm listing in 2021. One97 Communications, the parent firm of Paytm, came up with a massive Rs 18,300 crore IPO at a valuation of $19 billion, pricing it at Rs 2,150 per share. Part of the IPO comprised a Rs 10,000 crore OFS. Marquee investors like Alibaba Group and SoftBank Group took money home. However, a lot of factors like rising interest rates, volatility in global markets, small appetite of Indian investors, and valuing IPO on future prospects rather than proven earnings led to massive listing day losses. In fact, on the basis of the closing price on listing day, Paytm saw the biggest drop in the history of IPO listings in India.
Coming to the Lenskart IPO, concerns have been raised about the Rs 70,000 crore valuation, which is based on future prospects instead of proven profits. The company has shown a net profit of Rs 300 crore in FY25, but that contains a Rs 167.2 crore non-cash gain.
However, the interesting part here is that the grey market premium (GMP) of the company has risen in the past few days. On October 29, the company was fetching a premium of a mere 12% to its issue price, which increased to 23.6% on October 31. This hints that the company has gained the confidence of investors.
Also, D-Street is comparing the Lenskart IPO with that of Zomato and Nykaa, a new-age company. Similar to MamaEarth, Zomato, and Nykaa, Lenskart also has a defined area of revenue generation.
All eyes are now on the actual listing day. Till then, it is a wait-and-watch game for the street.
Lenskart Solutions IPO: Issue size
The book build issue will mop up Rs 7,278.02 crore from the primary markets. The issue is a combination of 5.35 crore fresh shares amounting to Rs 2,150 crore and offer for sale of 12.76 crore shares aggregating to Rs 5,128.02 crores. The company has kept the price band in a range of Rs 382 to Rs 402 per equity share. The issue will close the subscription on November 04.
Lenskart Solutions IPO: Allotment and Listing
The allotment for the IPO is expected to be finalised on November 06, while the listing of the shares on the exchanges, NSE and BSE, is likely on November 10, as per the tentative schedule.
Lenskart Solutions IPO: Lot size
The lot size for an application is 37. For retail investors, they need to invest atleast one lot of 37 shares, amounting to Rs 14,874. The lot size investment for a small NII is 14 lots of 518 shares, totalling Rs 2 lakh, and for a big NII, it is 68 lots of 2,516 shares, equalling Rs 10 lakh.
Lenskart IPO: Objectives of issue
The company will be utilising Rs 272.62 crore for capital expenditure towards set-up of new CoCo (company owned and company operated) stores in India, Rs 591.44 crore for the expenditure of lease/rent/license agreements related payments for CoCo stores operated by the company in India, Rs 213.37 crore for Investing in technology and cloud infrastructure, and Rs 320 crore for brand marketing and business promotion expenses for enhancing brand awareness.
About Lenskart Solutions
Lenskart Solutions is a retail eyewear company involved in the design, manufacturing, branding, and prescription eyeglasses, sunglasses, contact lenses, and accessories.
The company operated under the direct-to-consumer model, offering a broad range of eyewear under its own brands and sub-brands. The company caters to all age groups and price segments. In FY25, 105 new collections were launched, including collaborations with well-known brands and personalities.
