PhysicsWallah
IPO Size: Rs. 3,480 cr
- Fresh Issue of Rs. 3,100 cr for (i) marketing Rs. 710 cr (ii) rental expenses Rs. 548 cr (iii) 232 new centre opening Rs. 465 cr (iv) tech infra Rs. 200 cr (v) Rs. 102 cr investment in subsidiaries
- Offer for Sale (OFS) of Rs. 380 Cr by both the promoters (82% stake to drop to 72% post IPO), no OFS by investor
Price band: Rs. 103-109 per share
M cap: Rs. 31,170 cr, implying 11% dilution
- Only 10% retail, as company is loss making
IPO Date: Tue 11th Nov to Thu 13th Nov 2025, Listing Tue 18th Nov 2025
Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.
India’s Top 2 Education Company, in Revenue terms
PhysicsWallah is a Noida-based higher education company, offering test preparation across 13 categories, such as competitive exams (JEE engineering, NEET medical, UPSC civil services) and others (CA, defence, GATE, government exams). It offers courses via:
- Online mode: social media (13.9 million subscribers, on 11 year old youtube channel), website, app, catering to 4 million students, with average revenue per user (ARPU) of Rs. 3,900 per annum.
- Offline and Hybrid: 303 centers catering to 0.3 million students, with ARPU of Rs. 40,400 per annum.
Offline Centres Yet to be Profitable
FY25 revenue of Rs. 2,887 cr is split equally between online and offline, with net loss of Rs. 243 cr. Excluding adjustment for fair value changes and other income, loss before tax stood at Rs. 296 cr, implying 10% net loss, at company level.
Online business is profitable, thanks to scale and technology, but offline is bleeding, with an effective net margin of negative 20%. Rent is a real cost in offline business and hence adjusted EBITDA is a misnomer. While Q1FY26 revenue rose 33% YoY to Rs. 847 cr, loss before tax and other income also jumped from Rs. 131 cr to Rs. 204 cr.
No near-term Path to Profitability
With 303 centres and company in expansion mode (looking to add 232 new centres till FY29E), profitability is not in near-sight. Offline business is very competitive and unorganized, where company is yet to prove its mettle.
Till date, company has raised Rs. 2,050 cr between July 2022 to Oct 2024 and has Rs. 1,570 cr cash equivalents, on a similar net worth.
Stretched Priced
No OFS by investor with high promoter holding is a respite from other ‘new-age’ IPOs, as PhysicsWallah has scaled-up business using technology. But M cap of over Rs. 31,000 cr implies a historic revenue multiple of 10x, which is demanding for double digit net loss margin. Last fund raise at Rs. 90 per share a year ago is no justification for 21% premium, when losses continue to swell. At Rs. 15 lakh cr, domestic education is a massive opportunity, but no listed company has been successful at scale.
Education can be close to heart for many, especially where PhysicsWallah offers ‘affordable’ coaching through online medium, but investment decisions must not be emotional.
12th Nov 2025 at 04:50 pm