PhysicsWallah shares experienced significant selling pressure on Tuesday, January 20, falling nearly 8% and extending losses for the third consecutive trading session. The edtech platform's stock has declined 14% over the past three trading days, with substantial trading volumes of around 44 lakh shares recorded by 11 am IST.

Market Performance and Valuation Impact

The sharp sell-off has significantly impacted the company's market valuation, with key metrics showing substantial changes from its listing levels.

Technical Analysis Indicators

The stock's technical position has deteriorated significantly, with multiple indicators suggesting weakness. PhysicsWallah shares are currently trading below all key short-term moving averages, including the 5-day, 10-day, 20-day, and 30-day averages. The Relative Strength Index has dropped to 31.7, approaching the oversold threshold of 30, which typically indicates potential buying opportunities for technical traders.

Business Performance and Growth Strategy

Despite market pressures, the company maintains strong operational momentum. Co-founder and whole-time director Prateek Maheshwari previously indicated that PhysicsWallah aims to achieve profitability within the next 12 months. The company's expansion strategy focuses on several key areas:

• Accelerated growth in southern India
• Strengthening presence across 11 Indic languages
• Expansion into multiple exam categories
• Balanced growth between online and offline segments

Revenue Mix and Financial Performance

The company's revenue structure demonstrates a balanced approach between digital and physical presence. Currently, 52% of revenue comes from online business operations, while offline centres contribute the remaining 48%. This revenue mix is expected to remain stable as both segments continue growing at healthy rates.

IPO Performance and Market Debut

PhysicsWallah's initial public offering demonstrated strong investor interest, with the ₹3,480 crore IPO subscribed nearly two times during the November 11-13 subscription window. The company delivered impressive listing gains of 36%, debuting at ₹145 on NSE and ₹143.10 on BSE against the issue price of ₹109.

Subscription details revealed varied investor participation across categories, with retail investors subscribing 106% of their quota, non-institutional investors at 48%, and qualified institutional buyers achieving 2.7 times oversubscription.

Company Background and Current Operations

Founded in 2016 by Alakh Pandey, who initially began uploading free physics lessons on YouTube, PhysicsWallah gained significant prominence during the pandemic period. The company has built substantial infrastructure with 303 offline centres operating across 152 cities in India and the Middle East, supporting its hybrid education model.

Brokerage views on Indian equities remain mixed, reflecting a balance between company-specific execution strengths, governance considerations, and valuation comfort. Recent recommendations from Nuvama, Jefferies, and Goldman Sachs highlight how analysts are selectively positioning across sectors ranging from building materials and financial services to digital education.

Goldman Sachs PhysicsWallah Coverage

Goldman Sachs has initiated coverage on edtech platform PhysicsWallah with a 'Neutral' rating and a target price of Rs 135.00, citing the company's strong execution capabilities in India's large addressable education market.

The brokerage outlined robust growth expectations for PhysicsWallah, projecting strong financial performance over the next five years:

Goldman attributed this optimistic growth outlook to robust top-of-the-funnel organic traffic, relatively benign competitive environment in the Indian edtech space, and pricing structure that supports deeper penetration into new educational categories.

Valuation and Market Positioning

PhysicsWallah's current valuation metrics place it within the premium segment of India's internet companies:

Goldman noted that these valuations position the company at the mid-to-high end of India's internet peer group valuation spectrum.

Strategic Expansion Initiatives

Despite positive growth projections, Goldman flagged concerns regarding PhysicsWallah's offline expansion strategy, describing it as "still nascent" with uncertainties around achieving steady-state margins in the physical education segment.

In a separate development, PhysicsWallah announced a strategic land acquisition to support its expansion plans:

Nuvama's Kajaria Ceramics Outlook

Nuvama maintains its hold recommendation on Kajaria Ceramics , reflecting the brokerage's cautious stance on the ceramic products sector. The recommendation comes as analysts evaluate cost optimization measures and market-share dynamics in the building materials space.

The mixed brokerage sentiment across sectors underscores the selective approach analysts are taking while balancing growth potential against valuation concerns in the current market environment.