Physics Wallah had a strong market debut, with its first-session close coming at 44% better than the issue price, showing that while Indian edtech’s funding winter persists, the bull run is back for investment in the sector. Shares, which were listed at ₹109, had traded as high as ₹161.99 before settling at ₹156.49, pushing the company’s valuation to about ₹448 billion, or around $5 billion based on Bombay Stock Exchange data.
The pop pushes Physics Wallah well past its listing price of roughly ₹315 billion and about 79% above its last private valuation of $2.8 billion. It is an enthusiastic endorsement of the startup’s hybrid model — a kind of online-offline blend optimized for test prep and upskilling — at a time that many edtech peers are contracting.
IPO Pop Bucks Edtech Gloom Amid a Market Reset
India’s edtech cohort is contending with a reset of costs, missteps around governance, and an unsympathetic funding climate. Once the bellwether of the sector, Byju’s is embroiled in legal and insolvency proceedings across jurisdictions, which have led to mass layoffs and strategic confusion. Unacademy has scaled back operations and headcount, and is said to be considering selling itself to UpGrad for $300 million to $400 million — well below its previous peak valuation.
Deal trackers at Venture Intelligence and Tracxn have logged a multi-quarter decline in edtech capital hop-ons as investors turn their focus to unit economics and governance. Against that backdrop, the reception for Physics Wallah suggests that public markets may be more receptive to disciplined models converting audience scale into predictable cash flows.
A Hybrid Play Constructed For Unit Economics
From a YouTube classroom that is the brainchild of founder Alakh Pandey, Physics Wallah now offers web- and app-based courses as well as centers in towns across the country. The approach relies on teacher-led instruction, cohort communities, and modular pricing that comes in cheaper than the cost of traditional coaching yet keeps customer acquisition efficient through an owned audience.
In the most recent fiscal reports it presented to India’s Securities and Exchange Board, the company said it posted ₹28.9 billion in revenue, a 49% increase year over year, along with a net loss of ₹2.4 billion versus a loss of ₹11.31 billion. Online channels accounted for 48.6% of operating revenue and offline centers, 46.8%, which highlights how hybrid delivery is helping to mitigate risk and level out seasonality. Paying subscribers scaled to 4.5 million, up 23% in the quarter and a testament both to brand pull and course breadth.
The offline footprint has grown rapidly, with 303 centers in 152 cities in India and the Middle East. Hybrid test prep is still a sturdy category; analysts at Redseer have repeatedly observed that physical centers continue to control the greater share of student spend, while penetration of digital grows. That fact gives Physics Wallah spaces to layer share where the wallet is while leveraging digital as an acquisition reducer.
Where the IPO Money Is Going and How It Will Be Used
The company raised ₹34.8 billion ($469.9 million) in the offering, comprising a ₹31 billion fresh issue and a ₹3.8 billion secondary sale by co-founders Alakh Pandey and Prateek Boob, who together held about 80% pre-listing, according to prospectus details and exchange data.
Management has identified three uses for the funds:
- Increasing offline capacity
- Upgrading the tech stack
- Selective acquisition
Expansion capital will focus more on city clusters and exam categories, propelled by platform investments in adaptive learning, teacher tooling, and back-end systems. Speaking during the listing ceremony, Pandey pegged the milestone as a validation and not an end, with execution discipline taking precedence over headline growth.
Valuation Signals and Broader Sector Read-Through
Test prep economics can be appealing: make an upfront payment, offer a cohort-based delivery that scales faculty time, and then cross-sell into adjacent exams. Physics Wallah’s increasing loss profile indicates its operational leverage due to bigger batches and closer reuse of content. If the company sustains its pace of customer signups even during peak onboarding periods, margin growth could persist without excessive discounting.
For the wider space, the coming-out provides a playbook: hybrid distribution, structured pricing, and a path to cash flow that public investors can underwrite. Rivals like Allen Career Institute and Aakash (now part of a rival group) have long relied on offline strengths; Physics Wallah’s trajectory suggests a digital-first brand can get to similar economics with a different cost base.
Risks and What to Watch in the Coming Quarters
Execution remains the swing factor. Quick proliferation of centers raises the risk of lower utilization and faculty retention; demand could shift based on changes in exam patterns or regulatory enforcement. Compliance requirements for advertising and results reporting in edtech are already increasing, and the company will also have to keep up its product quality as it expands.
Still, the first-day close significantly above issue price and listing valuation shows that investors are willing to pay for a clear operating blueprint. With exchange data, SEBI filings, and third-party research pointing to a big, still-offline-heavy market, Physics Wallah’s risk is not one of demand — in other words, it’s less rocket science than executing against a disciplined, hybrid growth curve.
