EdTech unicorn PhysicsWallah is set to significantly expand its offline presence in India and select overseas markets. The company plans to allocate ₹460.55 crore from its upcoming Initial Public Offering (IPO) proceeds to establish new offline and hybrid centers.

Investment Breakdown

The investment will be distributed across three categories:

Current Offline Presence

PhysicsWallah currently operates 198 offline centers across 109 cities in India and the Middle East. The company's offline footprint has been growing at an impressive Compound Annual Growth Rate (CAGR) of 165.90%.

IPO Details

PhysicsWallah's upcoming IPO will consist of:

• A fresh equity issue of ₹3,100 crore
• An offer for sale of ₹720 crore

Expansion Plans

The company is eyeing potential expansion into tier-2 and tier-3 cities, including:

• Muzaffarpur
• Dhanbad
• Akola
• Latur
• Rajkot
• Ujjain
• Bhatinda
• Jorhat
• Chennai

The final locations for new centers will be determined based on demographic demand and lease economics.

This strategic move by PhysicsWallah to strengthen its offline presence comes at a time when the EdTech sector is seeing a shift back to physical learning spaces. The company's substantial investment in offline and hybrid centers indicates its commitment to providing diverse learning options to students across various educational streams and geographical locations.

EdTech company PhysicsWallah has taken an unconventional approach in its Draft Red Herring Prospectus (DRHP) for its upcoming ₹3,820 crore Initial Public Offering (IPO). The company has listed a peculiar incident involving a student throwing a slipper at faculty during a video class as an operational and reputational risk factor.

Unique Risk Disclosure

In an unusual move, PhysicsWallah has highlighted classroom management challenges, including the slipper-throwing incident, alongside more traditional risk factors such as faculty turnover and competition. This transparent approach in risk disclosure sets a new precedent in the IPO landscape, particularly for education technology companies.

Hybrid Model and Expansion Plans

PhysicsWallah is betting on a hybrid model for its future growth. The company plans to:

• Strengthen its offline presence by expanding its network of physical centers
• Maintain its online offerings

This strategy aims to capitalize on both digital and traditional learning environments.

Founders' Stake in IPO

Founders Alakh Pandey and Prateek Boob are offering significant stakes in the company's public market debut. This move demonstrates their confidence in the company's future and aligns their interests with potential public shareholders.

EdTech Sector Challenges

PhysicsWallah's IPO comes at a time when India's EdTech sector is facing significant headwinds. Competitors in the space are grappling with various challenges:

• Unacademy and Vedantu have reduced their staff
• Byju's is facing insolvency pressures from US lenders

These industry-wide struggles highlight the importance of PhysicsWallah's hybrid model and its focus on sustainable growth.

Risk Factors and Operational Challenges

The company's DRHP outlines several operational challenges:

• Classroom management issues
• Staff-pushing incidents
• Faculty turnover
• Intense competition in the EdTech sector

By openly addressing these challenges, PhysicsWallah aims to provide potential investors with a comprehensive view of the risks associated with its business model.

As the EdTech landscape continues to evolve, PhysicsWallah's IPO will be closely watched by industry observers and investors alike. The company's unique approach to risk disclosure and its hybrid business model may set new standards for transparency and adaptability in the sector.