PhysicsWallah Shares List at 33% Premium; Strong Market Debut Despite Moderate IPO Subscription

Mumbai | November 18 – PhysicsWallah Ltd made a strong debut on the Indian stock market on Tuesday, listing at a 33% premium to its IPO price despite a relatively modest subscription level. The edtech company’s shares opened at ₹145 on the NSE and ₹143.10 on the BSE, compared to the issue price of ₹109 per share, valuing the company at ₹40,922 crore on listing.

The listing exceeded expectations from the grey market, where the premium hovered around ₹14, `just 13% listing gains. The stock’s performance, however, reflected stronger institutional confidence and the company’s aggressive shift toward a hybrid education model.

Edtech Firm Surprises With Strong Debut

PhysicsWallah’s mainboard IPO, which ran from 11–13 November, was subscribed 1.81 times, driven largely by qualified institutional buyers (QIBs).

• QIBs subscribed 2.70×
• Retail investors subscribed 1.06×
• Non-institutional investors subscribed 0.48×

While retail participation remained moderate and NII demand weak, the robust interest from institutional investors helped anchor confidence around the stock. The IPO was priced in the range of ₹103–₹109.

The strong listing also brought healthy gains for retail investors. The minimum lot size of 137 shares delivered a first-day profit of ₹19,865 per lot, based on the NSE listing price.

Market participants said the debut signals renewed appetite for profitable, cash-flow-focused edtech players after the sector witnessed significant volatility over the past two years.

PhysicsWallah raised ₹3,480.71 crore, including a fresh issue of ₹3,100.71 crore and an offer for sale (OFS) of ₹380 crore by founders Alakh Pandey and Prateek Boob.

A significant part of the proceeds will go toward strengthening the company’s physical and hybrid presence across India, highlighting a major strategic shift away from the “digital-only” model that defined early-stage Indian edtech.

• Key utilisation of IPO proceeds:
• ₹460.55 crore: Fit-outs for new offline and hybrid learning centres
• ₹548.30 crore: Lease payments for existing centres
• ₹47.16 crore: Investment in subsidiary Xylem Learning
• ₹28 crore: Investment in subsidiary Utkarsh Classes & Edutech
• ₹200.10 crore: Cloud and server infrastructure
• ₹710 crore: Marketing initiatives
• ₹26.50 crore: Acquisition of additional stake in Utkarsh
• Remainder: Unidentified acquisitions and general corporate purposes

The sizeable allocation toward marketing and acquisitions underscores the company’s ambition to scale aggressively in a highly competitive segment dominated by players such as Aakash BYJU’S, Allen Career Institute, and upGrad.

Hybrid Model Push Remains Key Strategic Focus

PhysicsWallah’s business model spans online test-prep content, offline learning centres, and hybrid centres operating on a two-teacher format — where students watch online lessons at physical centres and receive in-person doubt support. This flexibility has helped the company expand rapidly across Tier-II and Tier-III cities.

The company also offers test-prep modules for JEE, NEET, GATE, government exams, and school foundation courses. With India’s test-prep market expected to grow at a double-digit CAGR, analysts say PhysicsWallah’s hybrid approach positions it differently from legacy digital-only players struggling with high cash burn.

The IPO funds earmarked for cloud infrastructure and marketing also indicate the company is building a stronger digital backbone while scaling brand visibility across newer geographies.

Market Outlook: Listing Strength Sets Tone, but Valuation in Focus

The listing premium reflects optimism around PhysicsWallah’s ability to scale profitably, but cautioned that the company must demonstrate consistent revenue growth and sustainable margins to justify its valuation.

The IPO’s performance follows a turbulent phase for India’s edtech ecosystem, with several players restructuring, downsizing, or pivoting business models in response to rising costs and changing demand patterns.

Market observers also noted that the slower subscription in the NII segment indicates that the broader investor community may be waiting for more clarity around long-term profitability, especially as the company expands into capital-intensive offline operations.

Outlook

PhysicsWallah’s upbeat listing  despite a moderate IPO subscription, demonstrates investor comfort with its hybrid strategy and revenue visibility. With India’s test-prep market becoming increasingly competitive, the company’s performance over the next few quarters will be closely watched.

The stock opened strongly, but analysts say post-listing movement will depend on earnings delivery, pace of offline expansion, and profitability metrics.