ADIA may seal $500-million stake deal in eyewear start-up Lenskart

Eyewear firm likely to raise another $100 million from ChrysCapital

Abu Dhabi Investment Authority (ADIA) and private equity fund ChrysCapital are in negotiations to acquire a stake in eyewear start-up Lenskart for about $600 million, according to sources.

Delhi-based Lenskart’s valuation is expected to be at $4.5 billion. ChrysCapital, which has backed start-ups Dream11, Xpressbees and FirstCry in India, is expected to invest $100 million in Lenskart.

“The conversations are going on and the deal may be announced in a few weeks,” said a person familiar with the matter. “If the deal is done, then it is a significant validation for an omnichannel startup which is growing at a good pace amid the funding winter.”

Lenskart didn’t answer Business Standard’s request for a comment. A large investment in Lenskart will come at a time when start-ups are under stress and are laying off employees. As many as 58 per cent of founders of Indian start-ups expect fundraising to become tougher in 2023 and hiring muted, according to InnoVen’s ‘India Startup Outlook Report’. Only 53 per cent of founders had a positive experience while trying to raise funds last year compared to 92 per cent in 2021.

Lenskart’s consolidated revenue from operations grew 66 per cent to Rs 1,502 crore in FY22, compared to Rs 905 crore last year. The SoftBank-backed company reported losses of Rs 102 crore in FY22 after reporting a profit of Rs 28 crore in the previous financial year, according to data accessed by business intelligence platform, Tofler.

Lenskart was founded by Peyush Bansal, a former Microsoft employee, in 2010 along with co-founders Amit Chaudhary and Sumeet Kapahi. Lenskart has raised $1.06 billion in more than 19 funding rounds, according to the data platform Tracxn. It is backed by investors such as TPG, KKR, Temasek and SoftBank. 

The firm aims to ship 300-400 million spectacles a year and serve 50 per cent of users in India. As part of that strategy, the company is setting up the world's largest eyewear manufacturing plant in Bhiwadi, Rajasthan. It shall have the capacity to ship 50 million pairs of eyewear a year. Bansal is investing about $150 million to build this facility.