E-Paper
Zerodha spots a unique risk factor in Physics Wallah's draft IPO papers
Physics Wallah has filed with India’s market regulator a DRHP to raise ₹3,100 crore via an IPO, but not without a risk factor that stood out.
Zerodha, India’s largest brokerage by number of users, has spotted a unique risk in Physics Wallah’s draft IPO papers filed with India’s market regulator.
The online tutor has in its draft red-herring prospectus cited “failure to protect students’ and security” as a key risk factor, as that “may negatively impact our reputation and business”. While that seems as a legitimate concern for a company in the business of education, the fineprint makes for an amusing read, even for Zerodha.
“In 2023, a video of a staff member pushing a student in one of our offline centres was circulated on social media. Based on an internal assessment, we terminated the staff member involved in this incident,” Point No.16 in the “risk factors” stated.
“In another incident in 2023, a student was seen threatening a faculty member with a slipper over a video call.” Zerodha highlighted this “unique risk” in a post on X, without saying much else except citing the source as ‘Company DRHP’.
Physics Wallah IPO
Physics Wallah has filed draft papers for an IPO worth ₹3,820 crore to become the latest new-age, technology-driven startup looking to tap the Dalal Street for funds.
The company, backed by the likes of WestBridge Capital and Hornbill Capital, aims to raise ₹3,100 crore by issuing new shares and the rest ₹720 crore via an offer for sale by cofounders Alakh Pandey and Prateek Boob.
The Noida-based startup, which had a valuation of $2.8 billion in September 2024, plans to use the IPO proceeds to set up physical coaching centres and pay their rent, boost technology and marketing, and fund acquisitions. The company grew its revenue by 49% year-on-year to ₹2,887 crore in 2024-25, even as loss narrowed to ₹243 crore from ₹1,131 crore.
