PhysicsWallah Makes Strong Debut on BSE & NSE, Shares Surge over 42%

Indian edtech giant PhysicsWallah, which began as an online tutoring solution through YouTube back in 2016, has made a strong debut today by listing its shares at a premium on both stock exchanges, NSE and BSE. PhysicsWallah shares debuted at INR 143.10 on the BSE, representing a 31 per cent premium over the issue price of INR 109 at the upper band, and at INR 145 on the NSE, a 33 per cent increase from the issue price.

Financial Performance
The company's revenue grew drastically from INR 744 crore in FY23 to INR 2,888 crore in FY25, a nearly four-fold increase for India's largest edtech company. Its borrowings also fell sharply from INR 1,687 crore in FY24 to INR 33 lakhs in FY25, making it nearly debt-free.

PhysicsWallah also reported operating profits, with FY24 EBITDA at a loss of INR 829 crore, and an EBITDA profit of INR for FY25.

Strong Anchor Interest
Before its IPO, the edtech firm raised INR 1,562.85 crore from 57 anchor investors at the upper price band of INR 109 per share, ahead of its initial public offering (IPO).
According to the company's filing papers, 14,33,80,733 equity shares were allotted to anchor investors at INR 109 per share for the stated amount. Out of which, 7.95 crore shares, accounting for about 55 percent of the anchor book, were allocated to 14 domestic mutual funds across 35 schemes. These domestic funds collectively invested around INR 867 crore.

Major domestic participants took part, such as ICICI Prudential Mutual Fund, Kotak Mutual Fund, Nippon India Mutual Fund, Aditya Birla Sun Life Mutual Fund, DSP Mutual Fund, Motilal Oswal Mutual Fund, 360 ONE, Tata Mutual Fund, Bharti AXA Life, Edelweiss Mutual Fund, and Canara Robeco Mutual Fund.

International institutional investors such as Capital Research, Goldman Sachs Asset Management, Fidelity, Franklin Templeton, PineBridge, Eastspring Investments, and White Oak Capital also took part in the anchor book, signalling a strong investor interest in the growing edtech sector from India.

Issue risks
Despite a strong debut and improved operations, PhysicsWallah's net loss in FY25 stood at INR 243 crore, with looming operational costs.

Offline operations have seen the company rely on major demographics such as Delhi NCR, which contributed to 11 per cent of its revenue, followed closely by Patna with 9 per cent. Kota, which was once a major hub for offline-exam prep businesses and where PhysicsWallah also plied major trade, saw a sharp slowdown in its student enrollment, dropping from 27,000 in FY23 to 11,500 in FY25.

The edtech's paid user base, however, recorded a jump to 4.46 million in FY25, growing at a 59 per cent CAGR from FY23.

The company's faculty attrition is also a concern, while salaries made up close to 50 per cent of its operational costs in FY25. Firms like Aditya Birla Capital also noted that the reputation and personal brand of Founder-CEO and promoter Alakh Pandey are key moving forward, while citing other concerns such as piracy, plagiarism, and even unstable internet connectivity across the depths of the country, hindering company growth.
At the upper price band, PhysicsWallah's valuation stands at a steep valuation of INR 31,500 crore, ~ 11x its FY25 revenue.

PhysicsWallah shares at the end of the listing day traded at INR 155.20 (+42 per cent) on the BSE and INR 156.49 (+43.57 per cent premium) on the NSE.