💰 Financial Performance

Revenue Growth by Segment

Total revenue from operations for H1 FY26 reached INR 18,983 M, growing 29.4% YoY. The Online Channel contributed INR 9,350 M (49% of revenue), growing 34% YoY. The Offline Channel contributed INR 8,917 M (47% of revenue), growing 22% YoY. Other segments contributed INR 716 M (4% of revenue), growing 82% YoY.

Geographic Revenue Split

Not disclosed in specific regional percentages, but the company focuses on 'Bharat' (mass-market India) with 300+ centers established across the country and a mission to reach the remotest parts via mobile penetration.

Profitability Margins

Q2 FY26 PAT margin was 6.6% (INR 697 M) compared to 4.9% (INR 411 M) in Q2 FY25. However, H1 FY26 recorded a PAT loss of INR 573 M (-3.0% margin) compared to a loss of INR 307 M (-2.1% margin) in H1 FY25, primarily due to front-loaded marketing and expansion costs.

EBITDA Margin

Adjusted EBITDA margin for Q2 FY26 improved to 25.7% (INR 2,697 M) from 23.5% YoY. H1 FY26 Adjusted EBITDA margin stood at 15.6% (INR 2,962 M) compared to 15.4% in H1 FY25. Pre-Ind AS EBITDA margin for H1 FY26 was 3.8% (INR 722 M).

Capital Expenditure

Free Cash Flow to Firm (FCFF) for H1 FY26 was INR 6,441 M. The company plans to open 200 new centers over the next 3 years, with approximately 75 centers planned for the next year alone, funded through internal cash generation.

Credit Rating & Borrowing

Not disclosed in available documents; however, the company maintains a strong treasury of INR 25,519 M and operates with negative working capital, reducing the need for external borrowing.

⚙️ Operational Drivers

Raw Materials

As an ed-tech firm, primary costs are Employee Benefits (44.6% of H1 FY26 revenue at INR 8,472 M), Direct Expenses & Inventory (20.6% of revenue at INR 3,910 M), and Marketing Spend (approx. 10% of H1 revenue).

Import Sources

Not applicable as the company provides educational services; content and technology are developed internally in India.

Key Suppliers

Not applicable; primary 'suppliers' are faculty members and technology service providers on payroll or contract.

Capacity Expansion

Current capacity includes 300+ offline centers. Planned expansion includes 200 new centers over the next 3 years (~70 centers per year). For the next year, 75 centers are planned: 45 Vidyapeeth, 10 Pathshala, and 20 other category centers.

Raw Material Costs

Employee benefit expenses grew 34.5% YoY to INR 8,472 M in H1 FY26. Marketing costs are expected to moderate to 8-9% of revenue for the full year from 9.6% in the previous year.

Manufacturing Efficiency

Engagement metrics show 3.5 M+ Daily Active Users (DAU) with an average engagement time of 103 minutes per day on the PW App.

Logistics & Distribution

Not applicable; digital delivery model has low marginal costs, while offline distribution is handled through regional centers.

📈 Strategic Growth

Expected Growth Rate

29%

Growth Strategy

Growth will be achieved by scaling the offline footprint (200 centers in 3 years), maturing existing centers to reach ~13% EBITDA margins, and expanding into 13+ categories including JEE, NEET, Government exams, and Skills (Institute of Innovation and Skills).

Products & Services

Online live classes, hybrid coaching (Pathshala), offline coaching (Vidyapeeth), and educational apps for K-12, JEE, NEET, and vocational skills.

Brand Portfolio

PhysicsWallah (PW), Vidyapeeth, Pathshala, Curious Jr, Institute of Innovation and Skills, Utkarsh Classes, Knowledge Planet.

New Products/Services

Expansion into 13 categories beyond core JEE/NEET; new verticals like Curious Jr and Skills training are expected to contribute to future growth as they mature.

Market Expansion

Targeting 200 new centers in 3 years across India; next year's 75-center expansion includes 45 Vidyapeeth and 20 subsidiary/government exam centers.

Market Share & Ranking

Enrolment leader in more than seven online segments; established 300+ centers in four years, significantly faster than traditional competitors.

Strategic Alliances

Acquisitions and partnerships include Utkarsh Classes and Knowledge Planet to broaden category and geographic reach.

🌍 External Factors

Industry Trends

The industry is shifting toward hybrid (online + offline) models. PW is positioned as a leader in this transition, leveraging affordable mobile data to reach mass-market students.

Competitive Landscape

Competes with traditional offline players (JNF players) and other ed-tech firms; PW's advantage is its significantly lower pricing and rapid offline scaling.

Competitive Moat

Durable advantages include a low-cost digital delivery model, brand trust ('PhysicsWallah'), and a structural moat created by high capital efficiency and negative working capital.

Macro Economic Sensitivity

Education is viewed as a non-discretionary household priority in India, making the sector resilient to economic uncertainty.

Consumer Behavior

Increasing preference for affordable, high-quality digital and hybrid learning among the expanding middle class.

Geopolitical Risks

Minimal direct impact as operations are focused on the Indian domestic education market.

⚖️ Regulatory & Governance

Industry Regulations

Subject to Indian educational regulations and guidelines for coaching centers; the company emphasizes 'innovating responsibly' and 'staying rooted' in its mission.

Environmental Compliance

Not disclosed; low environmental impact as a service-based education provider.

Taxation Policy Impact

H1 FY26 tax expense was INR 567 M despite a pre-tax loss, likely due to deferred tax or non-deductible expenses.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the timeline for offline centers to reach maturity; currently, centers turn EBITDA positive in year 2 and return capital in year 3.

Geographic Concentration Risk

Revenue is diversified across India through 300+ centers and a nationwide online presence; no single region is cited as a concentration risk.

Third Party Dependencies

Dependency on mobile internet penetration and app store platforms for digital delivery.

Technology Obsolescence Risk

Mitigated by continuous investment in AI and technology-led optimization across content and operations.

Credit & Counterparty Risk

Low risk as fees are collected upfront from students, resulting in minimal receivables risk.