PhysicsWallah Shares Skyrocket to ₹162 on Debut – 7 Things You Need to Know Before Investing

From a whiteboard in a small room to a listed platform, college dropout Akash Pandey built PhysicsWallah through free YouTube content, which has nearly 14 million subscribers. The company entered the Indian public market at a valuation of Rs 311.70 billion (£2.6 billion).

The pandemic became a boon for India's edtech market, but digital fatigue set in as physical schools reopened post-lockdown, leading to a slump in user engagement and capital funding. Top edtech platforms like Byju's filed for bankruptcy, but a market rebound coupled with PhysicsWallah's unique business model could position the company for long-term growth.

Robust Market Enthusiasm on Market Debut

PhysicsWallah shares made their debut on Indian stock exchanges at around Rs 145 (£1.25), or a 33% premium to its IPO price of Rs 109 (£0.94) per share. The stock soared to a high of Rs 162.05 (£1.39) in intraday trading, implying gains of about 49% from its IPO price, and a valuation of Rs 459.9 billion (£3.9 billion).

The company recorded a modest IPO subscription at 1.81X overall, but qualified institutional buyers were 2.7X subscribed. In simple terms, institutional backing was strong, indicating long-term confidence in the company's fundamentals.

Wise Use of IPO Proceeds

PhysicsWallah plans to aggressively expand its hybrid business model. IPO filings reveal that a significant portion of the proceeds will be used to expand offline and hybrid centres, ramp up marketing efforts for customer acquisition, and for lease payments for physical coaching centres. Additionally, funds are earmarked for investment in cloud technology and infrastructure.

Maintaining Cost Discipline

Unlike Byju's high-expense expansion, PhysicsWallah has maintained relatively lower employee, acquisition, and advertising costs. While Byju's reportedly spent Rs 2.73 (£0.02) for every Re 1 (£0.008) earned, PhysicsWallah spent Rs 1.13 (£0.01) per Re 1 during fiscal year 2025.

This cost discipline supports sustainable growth and improves long-term profitability prospects.

Focus on Diversification

PhysicsWallah has a large online presence and over 300 offline and hybrid centres, including 198 physical institutions under PW Vidypeeth and Pathsala brands.

While Byju's aimed to become 'the Amazon of education' across multiple verticals—K–12, test prep, international curricula, coding, upskilling—this broad approach impacted its focus and resources.

PhysicsWallah is adopting a more targeted strategy, prioritising test preparation and expanding into Tier-2 and Tier-3 markets with classes in various languages. This vertical-by-vertical approach has supported sustained recent growth.

Long-term Growth Outlook

India's edtech market was valued at Rs 648.75 billion (£5.5 billion) last year and is expected to reach Rs 2.5 trillion (£21.4 billion) by 2030. Rising demand from K–12 students, higher education, and test prep ecosystems are key drivers.

The large market for competitive exams and increasing demand for affordable classes offer significant growth potential for PhysicsWallah. Balancing online and offline expansion could help it become a major hybrid player.

Limited but Strategic Capital Raising

Byju's raised over $5.8 billion (£4.4 billion) between 2015 and 2022—the highest in India's edtech history—leading to a valuation of $22 billion (£16.7 billion) in 2022. The company made numerous acquisitions, including Akash Educational Services for around $1 billion (£760.6 million), WhiteHat Jr for $300 million (£228.1 million), and stakes in Epic, Toppr, and Great Learning.

In comparison, PhysicsWallah has raised capital only twice: Rs 9 billion (£77.3 million) in 2022 and Rs 18.6 billion (£159.9 million) last year. The company has made some investments, such as Rs 5 billion (£42.9 million) for a 50% stake in Xylem Learning and Rs 2.5 billion (£21.4 million) for 40% in Sarrthi IAS, staying well below Byju's spending levels.

Risks to Consider

While PhysicsWallah is scaling rapidly and working to improve unit economics, it remains loss-making. Despite over 50% year-over-year growth in fiscal 2025, the company's expansion costs, especially for physical centres, could be high.

Rising competition and regulatory risks—such as frequent changes in exam patterns and education policies—could impact its strategy and require high adaptability. If expansion efforts don't meet expectations, the cash burn could become costly.

PhysicsWallah's disciplined growth, targeted focus on Tier-2 and Tier-3 markets, and strategic use of capital position it as a promising player in India's vast edtech market. While risks remain, its long-term prospects appear favourable amid growing demand for affordable, quality education.

Disclaimer: Our digital media content is for informational purposes only and not investment advice. Please conduct your own analysis or seek professional advice before investing. Remember, investments are subject to market risks and past performance doesn't indicate future returns.