PhysicsWallah Expands Civil Services Play With Stake Acquisition In Sarrthi IAS

IPO-bound PhysicsWallah (PW) has picked up a 40% stake in UPSC coaching institute Sarrthi IAS at a valuation of around INR 250 Cr, sources told Inc42.

The deal will allow Sarrthi to leverage PW’s tech infrastructure, the sources added.

The development was first reported by Entrackr. PW declined to comment on the acquisition.

Founded in 2023 by IIT Roorkee alumnus Varun Jain, Delhi-based Sarrthi IAS provides UPSC coaching and personalised mentorship for Civil Services Examination (CSE) aspirants. It offers courses in the range of INR 18,000 to INR 27,000. The institute also operates a dedicated mobile app and also has a physical offline centre in Delhi.

The acquisition would help PW bolster its presence in the UPSC preparation segment. The startup entered the segment in late 2023 by launching ‘PWOnlyIAS’. It competes with well-established players like Drishti IAS, Vajiram & Ravi, Vision IAS, among others.

The UPSC test preparation market size in India is estimated at about INR 8,000 Cr, accounting for a significant share of the country’s competitive test prep industry.

The acquisition comes in the run up to PW’s public listing bid, for which the startup recently received SEBI’s nod. While it filed for the IPO confidentially in March, the size of the offering is expected to be around INR 4,600 Cr. A big component of the public issue is likely to be an offer for sale (OFS). The IPO is expected to value the company at $3.7 Bn.

Founded in 2016 by Alakh Pandey, PW’s offerings span various educational segments, including two Gurukulam Schools, test preparation in 43 categories, a skilling vertical, and higher education and study abroad verticals.

Pandey started PW as a YouTube channel and offered affordable courses to students, disrupting the coaching landscape. Gradually, after the joining of Prateek Maheshwari as PW’s second cofounder in 2020, the startup scaled up to become a full-fledged edtech startup providing online and offline coaching and study material for test preparation for various competitive exams such as NEET, JEE, among others.

The latest deal adds to PW’s acquisition spree over the past few years, which includes PrepOnline (test prep for NEET, CUET in 2023), Altis Vortex (exam prep books in 2023), FreeCo (doubt-solving, 2022), iNeuron (AI and data science learning, 2022), and Xylem Learning (hybrid learning, 2023).

PW also operates subsidiaries such as PW Skills, PW MedEd, PW Institute of Innovation, AcademFly, CuriousJr, Knowledge Planet, and Etoos India.

On the financial front, the startup’s net loss ballooned 13.5X YoY to INR 1,131.2 Cr in FY24 due to changes in the fair value of CCPS and higher ESOP and employee expenses. Its operating revenue surged 2.6X to INR 1,940.4 Cr in FY24 from INR 744.3 Cr from the previous year.

PhysicsWallah's financial trajectory

Source: Inc42 Datalabs

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While the startup is yet to file its financial statements for FY25, sources told Inc42 that it achieved breakeven in FY25.