PhysicsWallah IPO Review: India’s EdTech Giant Goes Public – Apply or Avoid?

Hello, fellow investors! The mainboard is buzzing again, and this time it's a name that almost every student and parent in India knows: PhysicsWallah (PW).

Led by the popular Alakh Pandey, PW has disrupted the edtech space with its affordable and high-quality content. Now, it's opening its books to the public with a massive ₹3,480 crore IPO.

But is this high-growth story a profitable investment for your portfolio? Or is it a case of high hype and high risk? As always, IPO Ji is here to dive deep into the numbers, the business, and the verdict.

Let's break it down.

📈 PhysicsWallah IPO: Key Details at a Glance

First, let's get the essential details on the table. This is a book-built issue combining a Fresh Issue (to raise capital for the company) and an Offer for Sale (where existing investors sell their shares).

🚀 PhysicsWallah IPO GMP (Grey Market Premium)

The Physicswallah GMP is a crucial unofficial indicator of listing day sentiment. We are tracking this very closely!

IPO Ji Update: Follow us on social media for real-time GMP updates as soon as they are available. This will be a key factor in our final decision.

🏫 About the Company: The PW Revolution

You've seen the YouTube videos, now see the business. PhysicsWallah isn't just a channel; it's a full-fledged edtech ecosystem.

• Core Business: Offers test prep courses for competitive exams (JEE, NEET, UPSC) and upskilling courses (Data Science, Finance).
• Hybrid Model: It operates online via its app and website, and also has 303 tech-enabled offline centers.
• Massive Scale: As of July 2025, it had 13.7 million YouTube subscribers and over 4.1 million unique transacting users.
• Strong Brand: Led by its visionary founders, Alakh Pandey and Prateek Boob, the company has built immense trust and a loyal student base.

Key Competitive Strengths

• Explosive User Growth: Paid users grew at a CAGR of 59.19% from FY23 to FY25.
• Diversified Offerings: Operates across 13 education categories.
• Proprietary Tech: A strong tech stack to enhance the student learning experience.
• Strong Faculty: A large team of 6,267 faculty members.

📊 Financial Deep Dive: The Growth vs. Profitability Puzzle

This is the most critical section. We've dug into the (Restated Consolidated) financials from the RHP. Here's what we found.

(Amount in ₹ Crore)

IPO Ji's Analysis of the Financials:

1. Stunning Revenue Growth: The top line is nothing short of spectacular. Total Income skyrocketed from ₹772 Cr in FY23 to ₹3,039 Cr in FY25. This is the "high-growth" story investors are buying into.
2. The Profitability Problem: This is the big red flag. The company is loss-making. It posted a significant loss of ₹-1,131 Cr in FY24 and ₹-243 Cr in FY25. The first quarter of the new fiscal year (June 2025) is also loss-making.
3. The Great Debt Pay-off: Look at the "Total Borrowing" line. It has fallen from ₹1,687 Cr to just ₹0.33 Cr in one year! This is a massive positive. It seems the company used funds from a previous round (or internal accruals) to completely wipe out its debt before the IPO.
4. Net Worth Turnaround: Because the debt is gone, the Net Worth has swung from a negative ₹-861 Cr to a positive ₹1,945 Cr. This dramatically strengthens the balance sheet.

Financial Summary: PW is a classic "startup IPO" playbook. It's a high-growth, cash-burning machine that has cleaned up its balance sheet to look attractive for its public debut. The bet is that its massive revenue and market share will eventually lead to profitability.

🎯 Objectives of the Issue: Where Will the Money Go?

The company is raising ₹3,100 Crores in fresh capital. This is what it plans to do with it:

1. Expansion (Offline Centers): ₹460.55 Cr for new centers and ₹548.31 Cr for lease payments.
2. Subsidiary Expansion (Xylem & Utkarsh): Around ₹80 Cr for their offline center fit-outs and leases.
3. Tech Infrastructure: ₹200.11 Cr for servers and cloud costs.
4. Marketing: A massive ₹710.00 Cr is earmarked for marketing initiatives.
5. Acquisitions: An undisclosed amount for "inorganic growth" (i.e., buying other companies).

Analysis: This is a growth-oriented IPO. The money isn't being used to pay off old debt (that's already done). It's being pumped directly into capturing more market share through new centers and heavy marketing. The ₹710 Cr marketing budget confirms their aggressive cash-burn strategy to fuel growth.

👍 Strengths vs. Risks 👎

Disclaimer: This is not financial advice. All analysis is for educational purposes based on the RHP. Please consult your financial advisor before making any investment decisions.

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