Lenskart IPO Valuation Sparks Netizen Outrage, ‘Shark’ Peyush Bansal Slammed

The upcoming Initial Public Offering (IPO) of eyewear giant Lenskart Solutions Ltd. has triggered a fierce debate and widespread backlash on social media, with netizens and market analysts heavily criticising the company’s perceived exorbitant valuation. At the core of the controversy is the company’s high-stakes pricing, which implies a staggering Price-to-Earnings (P/E) ratio of over 230x based on its latest full-year earnings, and a valuation near $\text{Rs }70,000 \text{ crore}$ (approx. $8.5 billion).

A ‘Shark Tank’ Hypocrisy?

Much of the public ire has been directed at Lenskart’s co-founder and CEO, Peyush Bansal, who is also a high-profile investor on the popular reality show Shark Tank India. Netizens have been quick to point out a perceived hypocrisy, noting that Bansal is known on the show for grilling aspiring entrepreneurs over much lower valuations.

• One widely circulated social media comment quipped that, “If Peyush Bansal pitched Lenskart’s valuation to Shark Tank’s Peyush Bansal then he would have got rejected.”
• Others have branded the IPO as a “mockery” of public trust and a potential “wealth transfer from the poor to the rich,” fearing that retail investors will suffer the same fate as those in previous high-valued new-age IPOs like Paytm.

The criticism intensified following Bansal’s interview comments on the high P/E multiple. In his defense, the entrepreneur asserted that his primary job is to “create value for the customer,” and that the valuation is ultimately decided by the market and its strong advisors, rather than the entrepreneur. This response, which was seen as evasive of shareholder value, only fuelled further online trolling.

The Valuation Puzzle: 230x P/E and an 8x Jump

Lenskart’s valuation is primarily being questioned on two fronts: the aggressive P/E ratio and a significant, rapid jump in its internal valuation in the months leading up to the IPO.

• Sky-High Multiples: Analysts highlight that a P/E ratio of over 230 times makes Lenskart one of the most expensive consumer listings in India. This multiple suggests that investors are paying 230 times the company’s current earnings for each share, betting heavily on hyper-aggressive future growth that critics argue is difficult for a retail chain to sustain.
• The Pre-IPO Leap: Reports show that Bansal himself acquired a significant stake in Lenskart in a pre-IPO transaction at a much lower valuation—in one reported instance, at an $8,700 \text{ crore}$ (approx. $1 billion) valuation, only months before the IPO is seeking nearly eight times that value. This dramatic, sudden re-rating has been flagged as suspicious by market veterans, who question what fundamentals could justify such an 8x increase in just a few months.

Lenskart’s management, however, has sought to justify the pricing by classifying itself as a ‘tech company’ with an omnichannel model and a dominant position in an underpenetrated market. The company recently turned profitable in FY22, reporting a net profit of $\text{Rs }297 \text{ crore}$ from a loss the previous year, with a strong EBITDA growth CAGR.

Despite the warnings from many analysts who deem the valuation “stretched,” several brokerages have given a “Subscribe for long term” rating, citing the company’s strong brand, market leadership, and the immense growth potential of India’s eyewear market. Nevertheless, the storm of public and analytical scrutiny has made Lenskart’s IPO a major test case for the appetite of Indian public markets for heavily valued new-age companies.