Lenskart’s IPO: Major Returns Expected

Lenskart’s IPO, valued at Rs 7,278 crore, is anticipated to yield substantial returns, ranging from 4X to nearly 17X. This presents an excellent opportunity for its promoters and early investors. The subscription period will commence on October 31.

Details of the IPO

As per its Red Herring Prospectus (RHP), the Gurugram-based eyewear retailer seeks to gather Rs 2,150 crore through a fresh issuance of shares. Additionally, existing shareholders plan to sell up to 12.75 crore shares, estimated at Rs 5,128 crore, through an offer for sale (OFS) at the upper price bracket of Rs 402 per share, placing the company’s valuation around Rs 70,000 crore ($8 billion).

Promoters’ Financial Gains

The promoters of Lenskart are positioned for significant financial gains, collectively offering shares valued at about Rs 1,100 crore (approximately $125 million). Co-founder and CEO Peyush Bansal is set to sell shares worth Rs 824 crore, while Co-founder Neha Bansal will offer shares valued at Rs 41 crore. Prior to the RHP filing, Neha Bansal had transferred 22.38 lakh shares to Shrikanta R. Damani, spouse of DMart’s founder Radhakishan Damani, at Rs 402 per share, totalling Rs 90 crore.

Another co-founder, Amit Chaudhary, along with Sumeet Kapahi, an early team member, is also set to take part in the OFS, with each selling shares estimated at Rs 115 crore.

Investors Cashing Out

Lenskart’s initial backer, SoftBank, is slated to gain the highest amount from the IPO, offering 2.55 crore shares valued at Rs 1,026 crore. With an average acquisition cost of Rs 74.26 per share, the fund is on track for a 5.4X return on its investment. Schroders Capital plans to sell 1.91 crore shares worth Rs 766 crore, with an acquisition cost of Rs 40.9 per share, resulting in nearly a 10X return.

Premji Invest aims to offload 87 lakh shares valued at Rs 350 crore. With an average acquisition cost of merely Rs 24.14 per share, the venture firm stands to be the most significant winner in terms of multiples, achieving a 16.7X return, as noted in the RHP. Temasek will also sell shares worth Rs 316 crore, achieving a 4.1X return. Kedaara Capital and Alpha Wave, also joining the OFS, are expected to record substantial returns of 5.4X and 3.8X, respectively, cashing out Rs 296 crore and Rs 268 crore.