India’s Lenskart, which is eyeing to become one of the largest eyewear makers globally, could get a major boost towards that ambition. According to a report in Bloomberg, the Abu Dhabi Investment Authority (ADIA) is set to acquire a significant stake in the Indian eyewear retailer. The sovereign wealth fund is set to invest nearly $500 million, marking one of the more significant investments in an Indian startup by a foreign entity.
No official comments have been heard from anyone involved.
According to the report, ADIA has nearly sealed the deal to buy the stake in a mix of existing shares and new equity. The deal is yet to be set in stone, but provided that there are no further significant changes, the deal would put the valuation of the 13-year-old Lenskart at more than $4 billion. A final announcement may be made as early as this week.
As the largest optical brand in India, the 13-year-old Lenskart has carved a niche of its own in the eyewear retail sector in the Indian market. Today, it is known to offer a wide range of products including glasses, contact lenses, and sunglasses, mostly in the affordable eyewear segment, but also increasingly looking at going premium. The company has grown rapidly in recent years, with an offline network of over 750 physical stores across India, coupled with an already strong online presence.
With the investment from ADIA, the eyewear retailer will have access to the necessary resources to accelerate its growth and expand its operations beyond India. In addition to the financial investment, the deal will also provide Lenskart with access to ADIA’s extensive network and resources, which will benefit the startup when multiple startups and enterprises have wilted under the funding winter. Amidst falling stocks and valuations during an economic slowdown, investors have tightened their purse strings and adopted a more cautious approach. This, in turn, resulted in a fall in investment activity, a drought in funding, and mass layoffs.
For its part, Lenskart has raised over $900 million via multiple funding rounds till date, and counts the likes of SoftBank Group Corp, KKR & Co, PremjiInvest, and Temasek Holding Pte as its investors. While it is profitable, Lenskart clocked a net loss of ₹102.3 crores in FY22 and is planning an IPO offering within the next 48 months. The acquisition is also a significant milestone for ADIA, which has been actively seeking investment opportunities in India’s rapidly growing startup ecosystem. The investment in Lenskart is expected to provide ADIA with exposure to one of India’s fastest-growing industries, as well as an opportunity to partner with a leading player in the space.