Edtech giant PhysicsWallah has taken a significant step toward going public, filing draft papers for an initial public offering (IPO) worth Rs 4,600 crore, according to sources. The company has opted for the confidential pre-filing process, a method that allows businesses to submit IPO documents to the Securities and Exchange Board of India (SEBI) without immediately disclosing financial details to the public.
The proposed IPO will be a mix of fresh share issuance and an offer for sale (OFS), though the company has not yet revealed the breakdown between these components. PhysicsWallah has remained tight-lipped on its listing plans and declined to provide comments.
The startup is backed by prominent investors, including WestBridge Capital, GSV Ventures, Lightspeed Venture Partners, and Hornbill Capital. If the IPO proceeds successfully, PhysicsWallah could become India’s first edtech company to be listed on the stock exchange.
In November 2022, SEBI introduced the confidential pre-filing mechanism, giving companies the flexibility to withdraw their IPO plans if market conditions are unfavourable, without disclosing financial data publicly. Unlike traditional IPO filings, where the Draft Red Herring Prospectus (DRHP) is immediately available to the public, this route helps companies maintain financial privacy until they finalise their decision.
Several Indian startups, including Tata Play, Oyo, Swiggy, Vishal Mega Mart, Credila Financial Services, and Indira IVF, have previously used this approach to gauge market sentiment before proceeding with a listing.
Reports suggest that PhysicsWallah is actively working to fast-track its IPO process. On September 21, 2024, the company invited at least 10 investment banks to present their proposals for managing the offering, as per sources.
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This development follows PhysicsWallah’s recent $210 million (Rs 1,750 crore) funding round in September 2024, led by Hornbill Capital, with participation from Lightspeed Venture Partners, WestBridge Capital, and GSV Ventures. This funding boosted PhysicsWallah’s valuation to $2.8 billion (Rs 23,000 crore), marking a 2.5x increase from its previous valuation of $1.1 billion (Rs 9,000 crore) in its first funding round.
With its growing financial backing and increasing market influence, PhysicsWallah’s IPO could mark a historic milestone for India’s edtech sector, potentially paving the way for more online education firms to enter the stock market. However, market conditions and investor sentiment will play a key role in determining the final timeline and success of the listing.
