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Journalism of Courage
The Lenskart IPO, which opened on Friday (October 31) has created quite the buzz on social media. The reason? Its valuation — the IPO aims to raise Rs 7,278.02 crore — which is being labelled as “obscene” by many.
With the price band of each share being set at Rs 382-Rs 402, the company is looking at a valuation of Rs 70,000 crore. The IPO comprises a fresh issue of Rs 2,150 crore and an offer for sale (OFS) worth Rs 5,128 crore by existing shareholders and promoters.
The shares will be listed on BSE and NSE on November 10.
The Rs 70,000-crore valuation left people completely perplexed. An X user said: “Lenskart IPO values company at ₹70,000 Cr. With ~2,600 stores in India… 1 store ≈ ₹27 Cr valuation. Bhai, yeh chashme bech rahe hain ya diamond lenses [are they selling spectacles or diamond lenses]?”
“If Peyush Bansal pitched Lenskart’s valuation to Shark Tank’s Peyush Bansal then he would have got rejected,” quipped another.
The Lenskart valuation of Rs 70,000 crore indicates a PE ratio of 230. Netizens pointed out that this was contrary to what the investors on ‘Shark Tank’, of which Lenskart CEO Peyush Bansal is a part. Many even compared it to the Paytm fiasco of 2021.
Crazy valuations. “In Shark Tank they were asking businesses at 9-10x PE and here coming with IPO at 9x sales with >5000cr OFS, SHEER HYPOCRITES. Unfortunately Mutual Funds will subscribe to them and play with poor retail money. Good days for LMs, banks, QIBs, brokers… Another Paytm loading,” an X user surmised.
Some said the “Middle class retail, who invests in a SIP and goes back to job in dream of getting wealthy” is likely to lose in this IPO.
Many questioned Bansal’s “wisdom”: “After trying every lens, Lenskart turned out to be a clear ‘No’ ironic, considering they specialize in vision. And the Shark Tank wisdom guru? Seems like the left valuation playbook at home. As for the IPO, it’s less about public offering and more about public looting [sic],” said an X user.
“To all the people who missed the lessons from Mama Earth, Paytm & Nykaa, don’t worry, here’s your latest chance : #Lenskart #IPO Oh & yes, just to keep the learning process fresh, #boAt IPO isn’t far behind either,” said another X user.
Vishnu Agarwal, founder of Stock Knocks, said: “That warning, about pricing an IPO fairly, is the ghost haunting the Lenskart IPO. On one side, a “Shark Tank” promoter known for grilling founders on valuation. On the other hand, an IPO priced at an eye-watering 236x P/E, where the promoter himself bought a stake at an 8x lower valuation just two months ago.”
Lalit Rathi, founder of LKR investors said: “Half of India’s fund industry queued up for an IPO at obscene valuations. A company at 12x revenue and yet, every one of these so-called “valuation-conscious” fund managers jumped in without hesitation. Tomorrow, they’ll sit on panels lecturing retail investors about discipline, margin of safety, and long-term investing. But when the hype train rolls in, principles vanish faster than logic.”
“FY25 is actually a loss if you adjust for that one-time gain. 5500 crores revenue and 12x revenue multiple?! You can’t even play the “new age business” card anymore. This isn’t a VC pitch deck, it’s an IPO. Damn it! Even 3x revenue would raise eyebrows and here we are pretending gravity doesn’t exist,” he said.
However, a few were optimistic about the Lenskart IPO. Finfluencer Sharan Hegde in August defended the valuation saying: “It’s not cheap, but it’s not unprecedented — especially for a company with strong brand equity, tech-led ops (robotic lens manufacturing, virtual try-on), and omnichannel muscle.”
