Shares of PhysicsWallah, known for its test preparation programmes for JEE, NEET, GATE, and UPSC, made a strong debut on the bourses on Tuesday, listing at a 33% premium to the initial public offering (IPO) price and surpassing market expectations. The edtech unicorn, co-founded by Alakh Pandey and Prateek Boob, opened at ₹145 on the NSE and ₹143.10 on the BSE, against the issue price of ₹109, taking its market capitalisation to ₹40,922 crore.

The listing was better than Street expectations, as the stock was commanding a grey market premium (GMP) of ₹14 in the unlisted market, indicating an estimated listing price of around ₹123 per share, up 12.84%. The GMP for PhysicsWallah shares had earlier dropped to zero after the IPO saw a muted investor response, but momentum picked up in the past few days, pushing the premium to a high of ₹14.

Meanwhile, the equity market was trading lower, with the BSE Sensex and NSE Nifty falling 0.32% and 0.22%, respectively, in the early trade.

The ₹3,480-crore IPO of PhysicsWallah received a subdued response, with the issue being subscribed 1.8 times on the last day of bidding. The offer, which comprised a fresh issue of ₹3,100 crore and an offer for sale of ₹380 crore, attracted bids for 33.62 crore shares against the 18.62 crore shares on offer, according to exchange data.

The qualified institutional buyers (QIB) portion led the show, being subscribed 2.7 times, with strong interest from mutual funds (which bid for 16.03 crore shares) and foreign institutional investors (FIIs, 8.63 crore shares). The employee quota was also well received, being subscribed 3.49 times, while the retail portion saw a modest oversubscription of 1.06 times.

In contrast, non-institutional investors (NIIs) showed limited appetite, bidding for only 0.48 times their allotted quota.

The IPO, which opened on November 11 and closed on November 13, was priced in the band of ₹103–109 per share, with a ₹10-per-share discount for employees.

The company plans to deploy the IPO proceeds from the fresh issue to expand PhysicsWallah’s offline learning network, enhance its content and technology platforms, and meet general corporate purposes. It has proposed to invest ₹460.55 crore in capital expenditure for new offline and hybrid centres and ₹548.31 crore towards lease payments for existing centres.

Another ₹710 crore will be allocated to marketing initiatives, and ₹200.11 crore to server and cloud infrastructure. A portion of the proceeds will also be invested in subsidiaries such as Utkarsh Classes & Edutech Pvt. Ltd and used to fund inorganic growth through acquisitions.

Ahead of the IPO, PhysicsWallah raised ₹1,562.85 crore from 57 anchor investors by allotting 14.33 crore equity shares at ₹109 apiece, which saw participation from both domestic and foreign institutional investors.

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