PhysicsWallah Stock: Elara Securities Sets ₹140 Target Amid Offline Surge

Brokerage firm Elara Securities has initiated coverage on PhysicsWallah with a “Buy” rating and a target price of ₹140, implying a potential upside of about 39% from the current market price of ₹101.

The brokerage has valued the company using a sum-of-the-parts (SOTP) approach, reflecting the differing maturity levels of its online and offline businesses.

PW Strong Points

According to the report, PhysicsWallah’s core strength lies in its community-first, omnichannel model, which leverages free content and a low-cost digital funnel to build trust before converting users into paid offerings across both online and offline channels.

The company already operates at a significant scale and continues to expand. Elara highlighted that PhysicsWallah has around 134 million social media followers, 83 million app downloads, approximately 3.4 million daily active users, and 4.37 million paid enrolments in the first nine months of FY26.

Offline expansion is expected to be the primary driver of the company’s next phase of growth and monetisation. PhysicsWallah has expanded to around 318 centres across 200 cities, with approximately 413,000 paid offline enrolments in 9MFY26.

Elara expects offline revenue to grow at a compound annual growth rate (CAGR) of 25.5% between FY25 and FY28, supported by improving centre utilisation and a hybrid model that reduces dependence on star faculty.

Financial Estimates

The brokerage projects a strong profitability inflection ahead. It forecasts revenue to grow at a 27% CAGR and EBITDA at an 84.7% CAGR over FY25–FY28E. EBITDA margins are expected to expand from 6.5% in FY25 to 20% by FY28E, while adjusted profit after tax (PAT) is projected to turn positive in FY27E and reach ₹6.7 billion by FY28E. This suggests a shift from heavy investment-led growth to improved operating leverage over the coming years.

PhysicsWallah’s balance sheet is seen as a key enabler of its growth strategy. The company benefits from upfront fee collections, resulting in negative working capital, and reported a treasury of approximately ₹50.5 billion as of December 2025.

It also generated ₹6.4 billion in operating cash flow in 9MFY26, providing sufficient liquidity to fund expansion and adjacent initiatives without significant balance sheet stress.

Key Risks

The report also notes that the key risks are execution-related rather than demand-driven. Elara flagged potential regulatory changes in the coaching sector, slower-than-expected utilisation of offline centres, and challenges in faculty retention as major downside risks.

Among these, the ramp-up of offline centres is seen as the most critical near-term challenge, as costs tend to rise before centres reach maturity.