Broker’s call: Physicswallah (Buy)

Target: ₹135

CMP: ₹107.25

Physicswallah (PW), which started as a YouTube channel in 2016, is now one of India’s leading education technology companies offering both online and offline courses. Growth is underpinned by strong demand for quality education and the desire to succeed in highly competitive entrance examinations.

The company is largely insulated from AI-driven disruption in India and relatively resilient during broader macroeconomic slowdowns. While favourable demographics – the average age in India is 28 – provide a structural tailwind, the employment backdrop is challenging. With job creation modest, academic credentials have become increasingly important to compete for limited opportunities, supporting growth in household spending on exam preparation.

The industry is highly fragmented, led by hyper-local institutes and “star” teachers with only a few national players, so execution is key. PW’s online model is affordable and scalable across the country. A large proportion of JEE aspirants are not targeting the very top institutes of technology; many are seeking admission to a credible engineering program at reasonable cost.

We use a target EV/EBITDA multiple of 35x on our FY28e adjusted EBITDA of ₹960 crore to value PW. Including existing cash & equivalents of ₹5,000 crore, we value the equity at ₹38,600 crore or ₹135 a share.

We initiate coverage of the stock at Buy. Over FY26-28e, we expect a nearly sevenfold increase in adjusted EBITDA to ₹960 crore. This will be led by a 30 per cent CAGR in revenues and a sharp jump in margins – from 3.6 per cent in FY26e to 15 per cent by FY28.

Key downside risks include regulation changes, teacher attrition, and increasing offline competition.

Published on May 12, 2026