ADIA Looks To Invest $400 Million In Lenskart At $4.5 Billion Valuation, Retail News, Retail ET

Abu Dhabi Investment Authority (ADVERTISEMENT) is in advanced discussion with lens and its current stakeholders for a $350-400 million investment, the omnichannel eyewear retailer’s largest fundraising ever, said people familiar with the development. They said some of Lenskart’s investors are looking to partially divest.

The investment will primarily be through a secondary stock sale with a small primary round including growth equity at a $4.5 billion valuation. This is more than double the market capitalization of Warby Parker Inc., a New York-based online retailer of prescription glasses, contact lenses and sunglasses that was listed on the NYSE last September.

Investors in 12-year-old Lenskart include Softbank, KKR, PremjiInvest, Kedaara Capital, Temasek, Falcon Edge, Bay Capital and Chiratae Ventures. To date, the company has raised a total capital of $1.05 billion over 19 rounds according to Tracxn data. It has not yet been decided which investors will dilute and how much.

The investment once completed will bring ADIA close to 10% stake in Lenskart. A final announcement is expected in a few weeks.

ADIA and Lenskart declined to comment.

Lenskart expanded its international footprint last year in Singapore, the US and the Middle East and even acquired a majority stake in Japan’s Owndays in June, creating one of the largest online eyewear retailers. Asia’s largest line. The acquisition will expand its direct-to-consumer (D2C) footprint in Southeast Asian markets, including Singapore, Thailand and Taiwan.

The rapid expansion has resulted in a 66% growth in operating revenue in the last financial year. The growth, however, came at a cost as the company fell to a loss for the financial year that ended in March. However, it is expected to be profitable in FY23 at a consolidated rate and is on track to post 50% growth in its business sector in India alone.

The sale of eyewear products is Lenskart’s main source of income, contributing about 94.3% of total operating revenue in fiscal year 22, according to Registry of Companies (RoC) filings. Income from registration fees increased 14%, revenue from rentals, site license fees, scrap and customer support fees reached Rs 36 million in FY22.

Co-founder and CEO Peyush Bansal, 38, initiated the omnichannel strategy at the e-commerce portal, and Lenskart has more than 1,200 stores at home and abroad. According to recent media reports, its most prominent domestic competitor, Tata . Group giant Eyeplus, has 760 stores. By 2021, Lenskart has shipped around seven million pairs of eyeglasses.

The company has a manufacturing unit in Haryana and is expanding with a fully automated facility in Bhiwadi, Rajasthan, which will start operations in a few months. Billed as the world’s largest eyewear factory, it will allow Lenskart to ship up to 50 million pairs a year.

“It’s not a technology but over time it has adopted an omnichannel approach and has also invested heavily in production and basics. That’s why it has managed to avert the tech valuation crisis to a large extent,” said one investor, who asked not to be named. “Technology is central but it is built on it. That’s why, as it grows larger and larger, traditional PE or growth stock investors prefer TPG . Growththen scrapped and now KKR, Temasek finds the story compelling… It is also investing in its own brands and D2C strategy.”

EssilorLuxottica, founded through a €50 billion merger in 2017, is the world’s largest eyewear company with a market capitalization of €80 billion.

After supporting core infrastructure and real estate assets, ADIA, which manages nearly $800 billion in assets, has become an active investor in startups or emerging companies. have strong consumer connections and brand appeal or are doing research in advanced biotechnology and border technology, like some sovereign wealth fund colleagues from the Middle East. Except dependence Jio, Reliance Retail, PharmEasy and Taibang Biologics, ADIA have supported major renewable platforms such as Greenko and Renew.