Indian edtech firm PhysicsWallah raises $176.3m ahead of IPO

PhysicsWallah has raised 1,562.9 crore rupee (US$176.3 million) from 57 anchor investors at 109 rupee (US$1.23) per share ahead of its planned IPO.

The company allotted 14,33,80,733 shares to anchor investors, with domestic mutual funds receiving 55% of this allocation.

Domestic investors included ICICI Prudential MF, Kotak MF, Nippon MF, Aditya Birla Sun Life MF, Tata MF, and DSP MF..

Global funds such as Capital Research, Goldman Sachs Asset Management, Fidelity, Franklin Templeton, PineBridge, Eastspring Investments, and White Oak Capital also joined.

The 3,480 crore rupee (US$392.5 million) IPO opens November 11, with a price band of 103 rupee (US$1.16) to 109 rupee (US$1.23) per share.

It includes a new issue of 3,100 crore rupee (US$349.6 million) and an OFS of 380 crore rupee (US$42.9 million) by co-founders Alakh Pandey and Prateek Boob.

The company reported operating revenue of 2,887 crore rupee (US$325.6 million) and a loss of 243 crore rupee (US$27.4 million) in FY25.

In Q1 FY26, revenue was 847 crore rupee (US$95.5 million) with a loss of 127 crore rupee (US$14.3 million).

🔗 Source: Entrackr

🧠 Food for thought

Implications, context, and why it matters.

PhysicsWallah’s 9.7x FY25 revenue multiple needs scrutiny

PhysicsWallah raised Rs 1,562.9 crore from 57 anchor investors. The implied market capitalization at the top of the band is Rs 28,073 crore 1, or 9.7x FY25 revenue of Rs 2,887 crore 2, while the company lost Rs 243 crore in FY25 3.
Think Investments bought in at Rs 127 per share, a 17% premium to the Rs 109 IPO price. Promoters Alakh Pandey and Prateek Boob are selling Rs 380 crore of stock 4, down from a planned Rs 720 crore 1.
PhysicsWallah posts an Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) margin of -2.51% 5. The Profit After Tax (PAT) margin sits at -14.99% 5, so valuation rests on growth in a sector hurt by Byju’s collapse 4.

Cloud and software vendors can pitch for Rs 200 crore tech spend

PhysicsWallah plans Rs 200.1 crore for server and cloud infrastructure 2. Software as a Service (SaaS) providers and cloud players such as Amazon Web Services (AWS), Azure, and Google Cloud could pitch. Content delivery networks and video streaming platforms can support 80 YouTube channels 6.
Another Rs 460.5 crore goes to offline center expansion, with Rs 548.3 crore for lease payments 2. Facility tech, Internet of Things (IoT) security, and hybrid learning vendors can back the rollout across 120+ Vidyapeeth centers (its branded offline learning centers) in 100+ cities 6. Marketing gets Rs 710 crore 2. Martech platforms and programmatic firms will need regional creators for local campaigns in 8 Indian languages 6.