Lenskart Prepares for IPO with $10 Billion Valuation

Lenskart is preparing for an Initial Public Offering (IPO), expected to value the company at $10 billion ( ₹86,780 crore). The company intends to file its Draft Red Herring Prospectus (DRHP) by May 2025, with the goal of listing on Indian stock exchanges before the end of the year. 

Lenskart's Rise and Strategy 

Founded in 2010 by Peyush Bansal, Lenskart has grown from an online eyewear retailer to a leading eyewear brand in India. The company's strategy includes acquisitions to expand its global presence, such as the 2022 acquisition of the Japanese eyewear brand Oneday for $400 million and investments in the French brand Le Petit Lunetier. Lenskart produces 30-40 million lenses and 25 million frames annually.

Financial Performance 

Lenskart has made remarkable financial improvements in FY24. The company significantly reduced its net loss by 84.4%, from ₹63.7 crore in FY23 to ₹10.1 crore in FY24. Revenue from Operations saw a strong 43% year-on-year growth, reaching ₹5,427 crore in FY24 from ₹ 3,788 crore in FY23. Additionally, EBITDA more than doubled, rising 112.5% from ₹403 crore in FY23 to ₹856 crore in FY24. Lenskart achieved a net profit on a standalone basis of ₹144 crore in FY24, reflecting a 5.1% increase from ₹137 crore in FY23, marking a steady financial improvement.

Future Plans 

Lenskart intends to use the funds raised from the IPO to invest in technology, manufacturing, and product innovation and expand its international footprint. The company is increasing its focus on local manufacturing, including a $200 million (₹1,735 crore) investment in a new facility in Telangana. Lenskart also plans to expand its retail network by adding 400 stores to its existing 2,500.

Broader Significance 

Lenskart's IPO is seen as a significant event for the Indian startup ecosystem, symbolizing its maturity. The success of the IPO could encourage other Indian companies to go public.

Factors Influencing the IPO 

The final decision to proceed with the IPO will depend on market conditions. Discussions about valuation have occurred between CEO Peyush Bansal, key investors, and bankers. There's also consideration of foregoing a pre-IPO funding round.

Additional points

• Lenskart's India operations are currently profitable and expanding.
• The company is backed by SoftBank and Temasek.
• Lenskart is focusing on technology to improve customer experience and operational efficiency.

Disclaimer: This news is solely for educational purposes. The securities/investments quoted here are not recommendatory.

To read the RA disclaimer, please click here