Lenskart Stock Performance: IPO and Initial Trading Analysis
Key Developments
Valuation and Market Perception of Lenskart
Lenskart’s Strategy and Future Outlook
Investor Participation and Market Trends
Medical Disclaimer: This article is for informational purposes only and does not constitute medical advice. Consult a qualified healthcare professional before making health decisions.
Table of contents
Official guidance: SEC — official guidance for Lenskart recovers from tepid open to close first day
Sources: Information based on credible sources and industry analysis.
Lenskart shares experienced a volatile first day of trading following its initial public offering (IPO), ultimately closing slightly above the IPO price after a period of significant fluctuation. The Indian eyewear retailer’s ₹72.8 billion ($821 million) IPO, which was heavily oversubscribed, sparked debate about the company’s valuation. While the IPO was sold out within hours, the initial market reaction was tepid. However, Lenskart recovered from a tepid open to close the first day, demonstrating resilience and investor confidence in its long-term prospects.
The stock opened at ₹395, below the IPO price of ₹402, and subsequently fell as much as 11% to ₹356.10 during the trading session. This initial downturn raised concerns about the market’s perception of Lenskart’s valuation. However, the stock staged a recovery, eventually closing at ₹404.55. Lenskart recovered from a tepid open to close the first day, a result that values the company at approximately ₹702 billion (around $8 billion). The IPO saw bids coming in at about 28 times the shares available, primarily driven by institutional investors, reflecting strong underlying demand despite the initial price dip.
Lenskart’s financial performance in fiscal year 2025, which ended in March, showed revenue rising 23% year-over-year to ₹66.53 billion (about $750 million). Net profit reached ₹2.97 billion (around $33 million), which included a one-time accounting gain of ₹1.67 billion (about $19 million) related to the acquisition of Owndays. Excluding this gain, the company’s core profit was ₹1.30 billion, or roughly $15 million. This profitability, even with the one-time gain factored out, is a key factor as Lenskart recovers from a tepid open to close the first day.
The company had sought a valuation of approximately ₹700 billion – around $7.9 billion – at the top end of the IPO price range. This valuation placed Lenskart among the most richly valued of India’s new-age consumer brands, alongside companies like Honasa and BlueStone. The valuation represented a more than 60% increase from the roughly $5 billion level at which Lenskart shares were traded in a secondary share sale last June, involving late-stage investors Fidelity and Temasek. Fidelity had later marked up Lenskart’s valuation by 12% to $5.6 billion in November of the previous year.
However, the proposed valuation implied about 230 times Lenskart’s core net profit and roughly 10 times its revenue, leading to considerable debate among retail investors and on social media platforms. DSP Asset Managers, an investor in the company prior to the listing, defended the valuation despite acknowledging it was “expensive,” arguing that the business remains “strong and scalable.” Despite the initial market jitters, Lenskart recovers from a tepid open to close the first day, suggesting that some investors believe in the company’s long-term growth potential and market position.
Lenskart’s core strategy revolves around its vertically integrated model, where it controls all aspects from manufacturing to retail stores. The company believes this approach gives it a competitive edge over legacy optical chains and online rivals. However, Lenskart faces competition across various price points from established players like Titan Eye+ and emerging direct-to-consumer brands. Successfully scaling profitably in India and overseas remains a key challenge.
Chief Executive Peyush Bansal, who has gained public recognition as a judge on Shark Tank India, described the IPO issue as “fairly priced,” citing feedback from institutional investors. He emphasized that Lenskart’s primary goal is to reach a wide audience, from major cities like Delhi to smaller towns across India. Lenskart plans to utilize the IPO proceeds to support its expansion plans, including opening new stores, strengthening its supply chain and retail infrastructure, and investing in technology and marketing. A portion of the funds may also be allocated for acquisitions and other general corporate purposes. This strategic focus is essential as Lenskart recovers from a tepid open to close the first day and looks to the future.
Existing investors, including SoftBank, Schroders Capital, Premji Invest, Kedaara Capital, and Alpha Wave Ventures, sold shares in the IPO. Co-founders Peyush and Nehal Bansal, Amit Chaudhary, and Sumeet Kapahi also divested a portion of their holdings. Lenskart’s listing occurs during a period when several Indian startups are increasingly turning to public markets as late-stage venture funding becomes more constrained and domestic investor appetite grows. Fintech firms Groww and Pine Labs, edtech platform PhysicsWallah, SaaS provider Capillary Technologies, and consumer brand BoAt are among the startups preparing for their IPOs in India.
In conclusion, Lenskart recovers from a tepid open to close the first day, showcasing the inherent volatility of IPOs and the market’s ongoing assessment of the company’s valuation. While the initial trading performance was below expectations, the subsequent recovery suggests underlying investor confidence in Lenskart’s business model and future growth prospects. The company’s strategic focus on expansion, technology investment, and potential acquisitions will be crucial in sustaining this momentum.
Financial Disclaimer: This article is for informational purposes only and does not constitute financial advice. Consult a qualified financial advisor before making investment decisions.
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