PhysicsWallah IPO off to a slow start, sees only 7% bids on Day 1. Check GMP and subscription details

PhysicsWallah IPO: The initial public offering (IPO) of edtech platform PhysicsWallah kicked off for bidding on Tuesday, November 11, garnering a lukewarm response from the investors on the first day.

Barring the employee portion, all other segments remained undersubscribed. However, investors have the scope to apply for PhysicsWallah IPO till Thursday, November 13.

PhysicsWallah IPO Subscription Status

PhysicsWallah IPO received bids for 1,31,22,682 shares as against 18,62,04,143 shares on offer, resulting in a 7% subscription.

The retail individual investors category was subscribed 33% while the portion for non-institutional investors received a 2% subscription. The qualified institutional buyers (QIBs) category did not see any participation on the first day. Lastly, the employee category received 1.11 times bids.

PhysicsWallah IPO GMP

The grey market premium (GMP) for PhysicsWallah has declined drastically. As of today, PhysicsWallah IPO GMP is ₹3. This means that shares are trading at a premium of ₹3 over the price band cap of ₹109.

At the current GMP, PhysicsWallah IPO shares could list at ₹112, a premium of 2.75%. The GMP has fallen from ₹9 to ₹3 currently, which is its lowest so far.

PhysicsWallah IPO Details

Ahead of the IPO opening, the company raised ₹1,563 crore from anchor investors on Monday. The ₹3,480 crore IPO of PhysicsWallah is priced in the range of ₹103 to ₹109 apiece. The company is targeting a valuation of ₹31,500 crore at the upper end of the issue.

PhysicsWallah IPO is a mix of fresh share sale of ₹3,100 crore and an offer for sale (OFS) of ₹380 crore by the promoters. Alakh Pandey and Prateek Boob will offload shares worth ₹190 crore via the OFS.

PhysicsWallah plans to utilise the fresh issue proceeds to drive its expansion and growth initiatives. Of the total funds, ₹460.5 crore will be allocated for fit-outs of new offline and hybrid centres, while ₹548.3 crore will be used for lease payments of existing centres.

The company will invest ₹47.2 crore in its subsidiary Xylem Learning, including ₹31.6 crore for new centres and ₹15.5 crore for lease payments and hostels. Additionally, ₹33.7 crore will be directed to Utkarsh Classes & Edutech for lease payments of its centres.

Further allocations include ₹200.1 crore for server and cloud infrastructure, ₹710 crore for marketing initiatives, and ₹26.5 crore for acquiring an additional stake in Utkarsh Classes.

The company offers test preparation courses for competitive examinations, as well as other courses such as upskilling programs. Its delivery channels include: (i) online, through its website and apps; (ii) tech-enabled offline centers, where faculty conduct live classes in a physical center; and (iii) hybrid centers, which follow a two-teacher model where students attend live online classes at a physical center while benefiting from an additional faculty member present at the center to resolve questions and conduct revision sessions.

PhysicsWallah shares will list on the Indian stock market on November 18.

Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.