SoftBank-backed Lenskart wobbles after volatile debut despite oversubscribed IPO

Shares of SoftBank-backed eyewear retailer Lenskart Solutions had a anemic debut Monday, slipping arsenic overmuch arsenic 11% beneath their contented terms earlier recovering successful aboriginal trade.

Lenskart shares were past trading 0.05% higher astatine 402.2 Indian rupees ($4.53), compared with its IPO contented terms of 402 rupees.

The tepid commencement contrasts with location work startup Urban Company's blockbuster listing successful September, which roseate implicit 60% connected its debut.

Lenskart's $828 cardinal IPO was among India's astir anticipated this year, drafting bids much than 28 times the shares connected offer. Institutional investors and high-net-worth individuals led the demand, portion retail involvement was comparatively muted.

Softbank-backed Lenskart IPO gets a tepid effect from investors

Many smaller investors person been chasing short-term gains by "jumping from 1 IPO to another," Bhavesh Shah, caput of concern banking astatine Equirus Capital, told CNBC. This churn from 1 IPO to different is creating selling unit connected the listing day, helium added.

A survey by India's marketplace regulator, the Securities and Exchange Board of India, recovered that 54% of IPO Shares allotted to investors — excluding anchor investors — are sold wrong a week. Between April 2021 and December 2024, retail investors sold 50% of the shares allotted to them by worth wrong a week of listing, and 70% of shares by worth wrong a year, the study revealed.

Lenskart's IPO was a hotly debated taxable connected societal media successful India past week, with immoderate analysts arguing that the contented "overvalued" the company.

"The IPO terms valued Lenkart astatine a [price–earnings ratio] of implicit 200 times and adjacent then, astir of the company's net for [the fiscal year] 25 were derived from non-core concern operations," said Devina Mehra, Founder of concern steadfast First Global.

Others defended the maturation prospects of 1 of India's astir storied startups. Sarthak Ahuja, an concern banker, highlighted successful a societal media station that several marquee organization investors participated early successful Lenskart's offering.

Some of the apical organization investors successful the Lenskart IPO include the Government of Singapore (2.97%) and planetary investors similar BlackRock and Fidelity, which bought shares done aggregate funds.