With Lenskart ending its subscription and Groww beginning its process, both Lenskart's and Groww's initial public offerings (IPOs) are garnering attention. Groww wants to raise ₹6,600 crore, while Lenskart wants to seek ₹7,278 crore. Grey market premiums, which indicate investor interest, point to hopeful listings for both businesses.
The initial public offerings (IPOs) of Lenskart and Groww are the subject of discussion today. The eyeglasses company is ending its subscription, while Groww's parent company, Billionbrains Garage Ventures, has begun selling shares.While the Groww IPO is gathering momentum on the first day of bidding due to interest from retail investors, whose portion was fully subscribed, the Lenskart IPO easily passed the first day of bidding.
Two of the year's most anticipated listings are Lenskart and Groww, which highlight two opposing facets of India's consumer technology development: investment in financial technology and retail eyewear.
With a target valuation of around ₹62,000 crore, Groww's share offering seeks to raise about ₹6,600 crore. The platform is a unique example of a lucrative fintech due to its size and profitability, with an estimated profit of ₹1,800 crore for FY25.
At a valuation of around ₹70,000 crore, the Lenskart IPO is anticipated to garner about ₹7,278 crore. Investor confidence in the company's omnichannel concept and brand memory is reinforced by its excellent anchor response. According to analysts, its attraction is increased by its steady revenue growth, growing retail footprint, and rising margins.
With a target valuation of around ₹62,000 crore, Groww's share offering seeks to raise about ₹6,600 crore. The platform is a unique example of a lucrative fintech due to its size and profitability, with an estimated profit of ₹1,800 crore for FY25.
At a valuation of around ₹70,000 crore, the Lenskart IPO is anticipated to garner about ₹7,278 crore. Investor confidence in the company's omnichannel concept and brand memory is reinforced by its excellent anchor response. According to analysts, its attraction is increased by its steady revenue growth, growing retail footprint, and rising margins.
Which IPO to apply for, Lenskart or Groww?
The Groww IPO gives exposure to India's digital-finance surge with a proven business strategy, while the Lenskart IPO offers a pure-play consumption story with long-term brand potential, according to Harshal Dasani, Business Head, INVasset PMS.
Groww's operational efficiency and earnings visibility seem more reassuring to investors looking for stability in the current IPO rush, whereas Lenskart is better suited for those who are ready to wager on fast-growth consumer brands despite their high valuations, he said.
The Groww IPO gives exposure to India's digital-finance surge with a proven business strategy, while the Lenskart IPO offers a pure-play consumption story with long-term brand potential, according to Harshal Dasani, Business Head, INVasset PMS.
Groww's operational efficiency and earnings visibility seem more reassuring to investors looking for stability in the current IPO rush, whereas Lenskart is better suited for those who are ready to wager on fast-growth consumer brands despite their high valuations, he said.
According to Abhinav Tiwari, Research Analyst at Bonanza, Lenskart trades at almost 535× their normalized FY25 earnings at the suggested valuation of Rs. 69,726 Cr, which is hard to defend.
"While operational expenses are still high, revenue growth has already slowed to 17% in FY25 from 46% a year earlier. Existing investors sell out a significant amount of their shares during the IPO, which could indicate a lack of short-term confidence. Since values seem inflated in comparison to Lenskart's earnings profile, we might see a post-IPO fall in the company's share price," Tiwari said.
"While operational expenses are still high, revenue growth has already slowed to 17% in FY25 from 46% a year earlier. Existing investors sell out a significant amount of their shares during the IPO, which could indicate a lack of short-term confidence. Since values seem inflated in comparison to Lenskart's earnings profile, we might see a post-IPO fall in the company's share price," Tiwari said.
On the other hand, he discovers that Groww has a wholly digital, asset-light business model that is highly scalable and has little additional costs. Groww is not risk-free, though, as brokerage accounts for more than 84% of its revenue, leaving it susceptible to changes in the market and the mood of individual investors.
He believes Groww has good long-term possibilities, nevertheless. "Groww stands to gain from structural tailwinds due to India's low demat penetration and rising digital usage. While the majority of the market remains unorganized in Lenskart's more established retail sector, maintaining growth will necessitate innovation, cost control, and brand strength, Tiwari continued.
Let's examine grey market premium trends and expert insights in more detail.
He believes Groww has good long-term possibilities, nevertheless. "Groww stands to gain from structural tailwinds due to India's low demat penetration and rising digital usage. While the majority of the market remains unorganized in Lenskart's more established retail sector, maintaining growth will necessitate innovation, cost control, and brand strength, Tiwari continued.
Let's examine grey market premium trends and expert insights in more detail.
Today's Lenskart IPO GMP is ₹56. The expected listing price of Lenskart is ₹458 per share, which is 13.93% more than the IPO price of ₹402, taking into account the upper end of the IPO pricing band and the current premium in the grey market.
The current GMP, which is around ₹56 after nine sessions of grey market activity, points to a possible downward trajectory. It's noteworthy that the greatest GMP reported during this time was ₹108, while the lowest was ₹48.00.
Today's Groww IPO GMP is ₹17. The expected listing price of Groww shares is ₹117 per share, which is 17% more than the IPO price of ₹100, taking into account the upper end of the IPO pricing band and the present premium in the grey market.
The present IPO GMP is on a rising trajectory, suggesting a solid listing, based on the grey market trends seen over the last seven sessions. According to analysts, the lowest GMP is ₹10.00, while the maximum GMP is ₹17.
Investors' willingness to pay more than the issue price is shown by the "grey market premium."
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