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If you’re remotely invested in the stock market, you would have heard of the Lenskart IPO and all the buzz surrounding it – especially around the valuation, the large offer for sale, and the inflated financials.
Well, we at ALT Investor decided to look at aspects that others don’t. So in this blog, we’ll quickly cover the fundamentals of the IPO, the controversies, and then talk about the other side of the story that nobody else is talking about.
Let’s begin.
Lenskart’s Rs 7,278 crore IPO is the first pure-play eyewear opportunity in India’s stock market. Here are some basic details about it.
| IPO size | INR 7,278 crores |
| Offer for sale for existing investors | INR 5,128 crores |
| Fresh Issue | INR 2,150 crores |
| IPO dates | Application date: 31 Oct till 4 Nov |
| Price band | INR 382 – INR 402 |
The shares are currently trading in the unlisted markets with a lot of volatility, and the Grey Market Premium (GMP) as of 26 October 2025 was up to INR 120 on certain platforms.
(If you want to know more about the grey market and unlisted shares, read our detailed blog here)
Well, if you know about the controversy, you can skip to the next section. But if you don’t, here’s what the market is saying:
Low capital infusion into the company and large exits: Over 70% of the IPO proceeds are going to existing shareholders selling their shares rather than fresh equity being raised by the company. This questions the whole premise of “raising money” for the company.
High P/E ratio: A big talking point has been the company’s P/E ratio of 230-235x (FY25 profit of Rs 297 crore) – considered to be very high P/E compared to typical industry standards of around 15-25 or even up to 40-80 – usually considered for high-growth startups. This means investors need to pay a massive premium for each rupee of current profit, pegged at the expectation of exponential future growth.
The profit quality itself: A big criticism centers around Lenskart's FY25 profit of Rs 297 crore. Digging deep into the numbers though, shows a different story altogether:
(source: valueresearch)
Lenskart has mentioned Rs 356 crore as "other income." Let’s break down where this Rs 356 crore other income came from:
Rs 73 crore came from sale of mutual fund investments
Rs 58 crore came from redemption of fixed deposits
The remaining, and biggest part of Rs 167 crore is where it gets interesting – In 2022, Lenskart had bought a Japanese company called Owndays for a mammoth amount of $400 million or Rs 3150 crore (as per prevalent exchange rate), including deferred payments. The expected future payment was revalued lower in FY25, thus creating a Rs 167 crore accounting ‘profit’ despite no actual cash flow.
This is what accountants call FVTPL gain (Fair Value Through Profit or Loss), which is a one-time accounting entry. There is no actual cash or business income involved in this.
So, after excluding this one-time gain and the other income, the normalised profit is much lower than what is quoted.
Lenskart had raised Rs 3,268 crore from 147 anchor investors, with bids totaling Rs 68,000 crore, i.e. nearly 10x the issue size.
Participants included:
Foreign Institutions such as the Government of Singapore, T Rowe Price, BlackRock, Fidelity, Goldman Sachs, JP Morgan, Nomura and Norway's Government Pension Fund Global.
Domestic institutions such as SBI Mutual Fund, HDFC Mutual Fund, Axis Mutual Fund and ICICI Prudential Mutual Fund.
INR 90 crore pre-IPO investment from billionaire and DMart founder Radhakishan Damani
Now, if the industry is saying that the IPO is questionable, why have these anchor investors invested in it?
Well, there are a few typical reasons (and one bitter truth/theory). Let’s look at the typical ones first:
Strategic diversification: Funds often take small initial allocations (e.g., 0.1-0.2% of AUM) across high-growth consumer tech plays to capture any upside if the company scales further
Brand leadership and growth: Lenskart is India’s largest branded eyewear retailer, growing its offline and online presence rapidly, which appeals to funds seeking exposure to scalable consumer brands
Limited risk due to small allocation: Most mutual funds have made minimal allocation, positioning this more as an “optionality bet” rather than a core portfolio holding.
Now, the dark theory (or truth).
Some experts say that the reason such leading AMCs tend to invest in such high valuation IPOs, is because of the fear of merchant bankers not giving them allocation to other IPOs in future. If that’s truly the case, we have a big problem in the industry – something that SEBI must look at.
With Lenskart’s 230 P/E ratio being a hot topic of debate amidst ongoing IPO, we want to explicitly cover this piece.
So we checked the P/E ratios of some of its listed competitors/peers – global as well as Indian:
| Company | P/E ratio |
| Warby Parker (US-based) | 150 |
| Essilor Luxottica (France-based) | 61.5 |
| GKB Opticals (India-based) | -4 |
| Bausch + Lomb (US-based) | -17 |
| Safilo Group (Italy-based) | 15.1 |
| Hoya Corp (Japan-based) | 40.5 |
Glancing over the P/E ratios of some of the largest listed eyewear companies around the world shows that they have low ratios in comparison to Lenskart.
But let’s also look at the other side of the debate.
We picked some of the most hyped startups that went for an IPO, that had really high P/Es. We saw the journey of their share price to determine whether they created investor wealth or not.
Let’s look at them one-by-one.
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This one is by far the winner of high valuations.
Zomato’s IPO was a huge buzz in India’s startup ecosystem getting listed at a price of Rs 116 compared to its price band of Rs 72-Rs 76. The listing price turned out to be higher than the unlisted share market’s GMP of Rs 8-17 at that time.
Back then, Zomato was sitting on a huge loss of Rs 1222 crores in its IPO year of FY21-22. A year after the IPO, its losses dropped to Rs 971 crore in FY23.
Then came its first ever profitable year of FY24, when Zomato recorded a profit of Rs 351 crores.
Zomato’s P/E ratio currently stands at a mammoth number of close to 1600! And why is that? Because its growth has been massive, with the company almost doubling its revenue just in Q2 of FY 26.
Eternal Ltd is a classic example of a company that has provided significant returns to investors, with its stock giving an impressive CAGR of 71% in the last 3 years. In spite of its skyrocketing PE.
Soon after Zomato tasted success in its IPO, Nykaa (FSN E-Commerce Ventures) went on to taste bigger success. It raised around Rs 5,350 crore, which included a fresh issue of only Rs 630 crores, with remaining being an OFS of about Rs 4,720 crore by existing shareholders.
Nykaa’s IPO issue price band was set at Rs 1085- Rs 1125 per share, and the stock had closed at Rs 2,206 on listing date, delivering a listing gain of around 95%.
In the grey market, Nykaa’s unlisted shares were trading around Rs 1,775- Rs 1,800 per share, roughly 60-70% above the then-offer price of Rs 1085- Rs 1125. This strong grey market premium which had indicated robust investor interest ahead of the IPO turned out to be right, as the listing went on to be successful.
As far as its P/E ratio is concerned, it was at 291 when it went for IPO in November 2021. Yes, higher than Lenskart’s 230.
Nykaa’s P/E right now? 880.
(Note that Nykaa had announced a bonus issue in the 5:1 ratio in the year 2022, which is why its share price got split).
In its IPO year of 2021, Nykaa was already a profitable company. Nykaa’s profit in FY2021-22 was Rs 41 crores, and it rose to Rs 72 crores in FY25.
Although Nykaa’s shares fell after the IPO, in the last 3 years, they’ve given a moderate CAGR of 10.5%.
So Nykaa’s case has shown that while it was profitable when it went for IPO and got a successful listing too, but its stock has dived and has only recently started giving moderate returns. And yet, it’s PE stays at 880.
Another IPO that had created huge buzz in the same year of Nykaa and Zomato, was Paytm. The price band was Rs 2,080-Rs 2,150 per share, and the total IPO size of Rs 18,300 crore, out of which Rs 8,300 crore was fresh issue and Rs 10,000 crore was OFS (offer for sale).
Paytm’s grey market story is one to tell. In the week wherein its listing was scheduled on November 18th, 2021, Paytm’s grey market premium had nosedived from Rs 150 to Rs 30 in just a handful of days. So just a day before listing (i.e. on 17th November 2021), Paytm’s unlisted shares were trading at Rs 2,180, down from Rs. 2,300 just a few days before that.
Paytm’s P/E ratio at present stands at 282. Again, higher than Lenskart.
In the IPO year of 2021 (FY2021-22), Paytm had a loss of Rs 2397 crore, but it has been able to narrow it down year by year, standing at Rs 663 crore in FY25. But finally in Q1 of ongoing FY26, Paytm managed to become profitable, which is why its stock had shown some improvement since July 2025 once the quarterly results came out.
Paytm’s case was worse than Nykaa, share went on to get listed at Rs 1950 (NSE) and then took a nosedive. However, in the last 3 years, the stock is bouncing back, with a CAGR of 26% and a P/E of 282
While many big IPOs had come up in 2021, the next startup that we deep dived into, became public just last year.
Travel booking app Ixigo (listed under parent name Le Travenues Technology) IPO’ed in June 2024. The price band was Rs 88-93, but Ixigo went on to make an impressive debut on the NSE when it closed the listing day at Rs 165.
Ahead of its listing in June 2024, Ixigo’s unlisted shares traded at a GMP of around Rs 29-Rs 30 in the grey market.
As far as financials are concerned, Ixigo was not only profitable in its IPO year of FY25 (2024-25), but also in the years FY21, FY22, FY23 and FY24 as well. Ixigo’s profit in its IPO year of FY25 was Rs 63.4 crores and its P/E ratio was 81.55 in June 2024.
As far as returns are concerned, while it's been just about 1.5 years since it went public, Ixigo has already given 36.41% CAGR in this period.
PB Fintech’s IPO took place in November 2021. The price band was set between Rs 940 and Rs 980, and it got listed at Rs 1,150.
In the grey market, its unlisted share prices had been on a rollercoaster in November 2021. Ahead of the IPO week, PB Fintech’s GMP ranged widely between Rs 40-Rs 150, and was around Rs 55 mark a day before the listing was done, signalling a negative trend in grey market investor enthusiasm. But the stock ultimately listed around 17% above the price band.
At the time of its IPO (FY21-22), PB Fintech was doing a loss of Rs 832 crores. The fintech company managed to get profitable in FY24 when its profit hit Rs 64 crores and then jumped to Rs 353 crores in FY25. Its P/E ratio stands at 178 today**.**
As far as returns to investors are concerned, the stock has delivered an impressive CAGR of 68% in the last 3 years, with a high P/E ratio of 178.
AFter witnessing a lot of buzz around its IPO and then an oversubscription of 28 times overall after investors placed bids for 281.88 crore shares against the 9.97 crore shares on offer, Lenskart’s much-anticipated debut on the stock market began with the shares opening at a 3% discount to the issue price on 10th November 2025. The stock debuted at Rs 390 on the BSE and Rs 395 on the NSE against the issue price of Rs 402.
But then in the following hours, Lenskart’s stock began to go up to as high as Rs 413.75 (on NSE) and Rs 413.80 (on BSE), but it eventually dropped again and closed its listing day at Rs 404.55 on NSE and Rs 403.3 on BSE, just a notch above the IPO issue price.
Well, we just saw a bunch of startups give decent returns to investors, during and post listing, with way higher valuations than Lenskart.
Look, while Lenskart’s profit numbers definitely need to be reviewed, startup valuations have historically been crazy in India. Now, we’re not saying whether this is good or bad. But it is what it is.
Maybe the way to value startups is different from traditional companies. Or maybe this is a bubble waiting to burst. Only time will tell. But screaming over valuations based on P/E for Lenskart, when other startups have gone the same way, needs further introspection.
If you’re someone who doesn’t want to get into this startup IPO frenzy, there are plenty of stable, profitable companies that have given better returns than the startups we saw. ICICI Bank, for example – a stable large cap company with solid fundamentals, has given a 14% CAGR in the same 3-year period as above.
Boring companies or exciting startups – it’s your call to make. All we’re trying to say is, don’t just decide to invest in, or dismiss, an opportunity based on 2-3 parameters that influencers are talking about. Take an informed call.
Please note that this is an opinion blog and not an official research advice. This blog aims to promote informed decision-making and neither encourages nor discourages you from investing in any asset class, deal or platform.
