Goldman Sachs on Wednesday initiated coverage on Physicswallah Ltd (NSE:PHYS) with a “neutral” rating and a 12-month price target of 135 Indian rupees, representing 0.4% upside from the current price of 134.40 rupees.
The education-technology platform, which serves 4.5 million paid users across online and offline channels, stands positioned for a 24% revenue compound annual growth rate between fiscal years 2025 and 2030, according to the brokerage.
The growth trajectory places PhysicsWallah at the mid-to-high end of the investment bank’s India internet coverage, with earnings before interest, taxes, depreciation and amortization projected to grow at more than 80% during the same period, though from a low base.
"We could see further upside if the company were able to show growth and penetration in newer education categories or show better-than-expected efficiency/operating leverage in its offline business," the analysts said.
The test preparation company generated annualized revenue of approximately $425 million as of the first half of fiscal year 2026, operating across 13 education categories including engineering entrance exams, medical entrance exams, civil services and chartered accountancy.
PhysicsWallah maintains approximately 100 million YouTube subscribers across more than 200 channels, which serves as an organic funnel for its paid courses, the report stated.
Goldman Sachs attributed the company’s competitive positioning to "strong top of the funnel organic traffic, a relatively benign competitive environment in India’s edtech sector, and PW’s pricing structure that allows it to penetrate deeper into multiple new education categories.”
3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads. The platform’s online courses cost up to 90% less than competitors, with base pricing at approximately 5,000 rupees compared with peer offerings ranging from 13,000 rupees to 97,000 rupees for engineering entrance preparation, the report stated.
The addressable market spans 80 million to 90 million students in India, with PhysicsWallah achieving approximately 5% penetration as of fiscal year 2025, or 15% when excluding other government exams, the brokerage said.
While the company captured 25% to 30% market share in its flagship engineering and medical entrance exam categories, penetration remained at 5% or lower in newer categories including civil services, MBA and board exams, the report stated.
Revenue growth through fiscal year 2030 will stem from a 12% increase in paid users and a 10% increase in average revenue per user, with the online segment expected to grow at a 26% compound annual growth rate compared with 21% for offline.
The company operated 314 offline and hybrid centers across more than 150 cities as of September 2025, with plans to reach approximately 500 centers within three years, the report stated.
PhysicsWallah’s adjusted EBITDA margin, calculated before employee stock ownership plan costs and after rent expense, stood at 3% in fiscal year 2025 after reaching breakeven following losses in fiscal year 2024, according to the report.
Goldman Sachs projected margins would expand 20 percentage points by fiscal year 2030 to reach 26%, with the online segment expected to reach 40% adjusted EBITDA margin while the offline segment was projected to reach 10% margin, the report stated.
