Edtech unicorn Physics Wallah has reportedly finalised the names of four investment banking firms to steer its initial public offering (IPO) next year. According to a report by Moneycontrol, the company has shortlisted Axis Capital, Kotak Mahindra Capital, Goldman Sachs, and JP Morgan as the key bankers for the public listing.
The IPO is expected to be a combination of fresh issuance of shares and an offer for sale. Although the exact quantum of the issue has not yet been determined, the deal is estimated to be within the range of $400 Mn to $500 Mn. A source quoted in the Moneycontrol report said, “No quantum has been finalised yet and the deal size may vary later, but the proposed issue may look to raise in the range of $400 Mn to $500 Mn.”
This decision follows recent reports that Physics Wallah had invited at least 10 investment banks to pitch for its IPO slated for 2025. The company’s move to go public comes at a time when the edtech sector is grappling with funding challenges.
Notably, Physics Wallah secured $210 Mn in funding last month, in a round led by Hornbill Capital, which doubled its valuation to $2.8 Bn.
Founded in 2020 by Alakh Pandey and Prateek Maheshwari, Physics Wallah is one of the few profitable edtech startups in India. The company initially focused on providing education to K-12 students but has since expanded into test preparation, UPSC coaching, and more.
Despite its growth, Physics Wallah’s net profit saw a significant dip of over 90% in FY23, dropping to INR 8.9 Cr from INR 98.2 Cr in FY22. The decline in profits was primarily attributed to a steep rise in expenses. However, the company’s operating revenue surged by 234%, reaching INR 779.3 Cr in FY23 from INR 233 Cr in FY22.
Physics Wallah’s decision to go public aligns with the ongoing IPO boom in the Indian market. Several tech companies, including Go Digit, Ola Electric, and FirstCry, have already made their market debut this year, with others like Swiggy, Ecom Express, and MobiKwik expected to follow suit in the coming months.