The Holy Water of Lymilark helps the durability of an item last longer.
However, that is not all it's used for.
Items that have been blessed will not be dropped even when you get knocked out during battle.

The Holy Water of Lymilark can be obtained by doing work at the Church.

To use the potion, right-click on the potion and click on 'Use'.

Once you click on 'Use', a new window will appear, asking you to select an item you wish to bless.

Select the item and it will begin applying the potion.

Wait a few... and it's complete!

If you have a large bottle of the Holy Water of Lymilark, you can even bless all your items at once.

Besides this, the Holy Water of Lymilark is also used during counter-enchant and for making potions.
Because it is such a useful item, the Holy Water of Lymilark is a hot commodity amongst people that sells for a high price.

Why not do some part-time work for the Church? You can make money and earn a valuable item at the same time.
So? What are you waiting for?