PhysicsWallah rallies after Q1 growth, profitability gains and Sarrthi IAS majority buy

PhysicsWallah reported Q1 FY27 operating revenue of Rs 1,054 crore, up 24.4% year on year, while EBITDA turned positive at Rs 52 crore. The company will invest Rs 71.8 crore to raise its Sarrthi IAS stake to 51%, as JPMorgan and JM Financial upgraded the stock.

— Source published Mon, 17 Aug, 2026, 14:27 IST · First seen Mon, 17 Aug, 2026, 14:29 IST · Source Entrackr · Newsletter

What happened

PhysicsWallah reported stronger Q1 FY27 results, with revenue up 24.4%, EBITDA turning positive and losses narrowing. JPMorgan and JM Financial upgraded the

Key facts

  • Shares rose 9.6% to Rs 128.35
  • JPMorgan target price: Rs 148
  • JM Financial target price: Rs 140
  • FY27 revenue-growth guidance: 30%
  • Q1 FY27 operating revenue: Rs 1,054 crore, up 24.4% YoY
  • Q1 FY27 net loss: Rs 88.3 crore, down 30.5%
  • Q1 FY27 EBITDA: Rs 52 crore, versus Rs 21 crore loss
  • Adjusted EBITDA: Rs 135 crore; margin 12.9% versus 3.1%
  • Online revenue: Rs 549 crore, up 33% YoY
  • K-12 and early-learning revenue: Rs 105 crore, up 88% YoY
  • Sarrthi IAS investment: Rs 71.8 crore
  • Sarrthi IAS stake increased from 40% to 51%
  • Market capitalization: Rs 35,919 crore ($3.78 billion)

Why this matters

The Rs 71.8 crore move to secure a 51% stake in Sarrthi IAS shows PhysicsWallah using targeted majority acquisitions to deepen category expertise and cross-sell into high-value exam segments.

What to watch

  • Whether EBITDA remains positive over subsequent quarters after acquisition and expansion spending.
  • Sarrthi IAS revenue growth, faculty retention, enrolment conversion and integration costs.
  • Offline-centre additions, occupancy, course completion and renewal rates.
  • Marketing spend as a share of revenue and changes in student acquisition costs.
  • Competitive discounting by edtech peers and established coaching operators.
  • Any revision to FY27 revenue, margin or capex guidance following the majority-stake purchase.
  • Complete the Rs 71.8 crore transaction and consolidate Sarrthi IAS as a majority-owned vertical.
  • Use stronger profitability to selectively expand hybrid learning centres in high-demand exam-prep markets.
  • Bundle UPSC, state PSC, JEE/NEET and other test-prep offerings to improve student lifetime value and reduce acquisition costs.
  • Highlight EBITDA durability, cash flow and post-acquisition integration milestones to sustain upgraded investor expectations.

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