Lenskart’s much-awaited Initial Public Offering (IPO), opening on October 31, has become one of the most hotly debated events in India’s financial circles. The eyewear giant, known for redefining how India buys glasses, is now eyeing a record-breaking valuation of nearly Rs 69,700 crore (USD 8 billion), priced between Rs 382 and Rs 402 per share.
But as excitement brews, a key question looms large: Is this price a fair reflection of Lenskart’s success, or has the market’s vision blurred under the dazzle of hype?
The price tag vs the performance
At the upper price band, Lenskart’s IPO implies a price-to-earnings (P/E) ratio of 230x its FY25 earnings, meaning investors pay nearly Rs 230 for every rupee of profit. That’s far beyond traditional retailers, which trade at 15-30x P/E, and even higher than some tech darlings.
The company’s financials show progress, revenues rose 23% in FY25 to Rs 6,650 crore, while profits touched Rs 297 crore, turning around from earlier losses. But growth has slowed from a rapid 46% in FY24, and margins remain slim. Critics argue that while Lenskart’s story is strong, its numbers don’t fully justify a valuation jump of this magnitude.
Balancing growth, margins, and market mood
Unlike a software startup with 80% profit margins, Lenskart runs a brick-and-click retail business, juggling online operations, franchise stores, and international expansions. Its EBITDA margins stay below 20%, typical for retail but modest for tech.
So why are investors willing to pay tech-style multiples for a retail business? Maybe because of faith in Lenskart’s brand strength, market leadership, and the belief that its omnichannel strategy and tech-driven logistics will yield bigger profits ahead.
Insider moves and investor debate
Fueling skepticism are reports that founder Peyush Bansal had earlier bought shares at a valuation of around Rs 8,500 crore – barely a fraction of today’s asking price – and now plans to sell part of his stake. To some, that looks like perfect timing.
Critics call it a “valuation bubble,” arguing that enthusiasm is outpacing fundamentals. Yet, defenders counter that Lenskart deserves a premium for revolutionising India’s eyewear space, comparing it to Titan’s early days.
The real takeaway
Lenskart definitely has scale, profitability, and a strong brand, but the Rs 70,000-crore question is whether that justifies a P/E north of 200.
For retail investors, this IPO offers both opportunity and a cautionary tale: it’s a test of whether India’s new-age consumer brands can sustain Silicon Valley-style valuations while rooted in the real-world economics of retail.