PhysicsWallah shares rallied on Monday after its first-quarter numbers prompted rating upgrades from JPMorgan and JM Financial, with a sharp improvement in profitability and an 88% rise in K-12 and early-learning revenue adding to the positive sentiment.
PhysicsWallah’s stock climbed 9.6% to Rs 128.35 after the education technology company reported its Q1 FY27 performance and received a vote of confidence from two major brokerages. JPMorgan upgraded the stock to ‘Overweight’ from ‘Neutral’, while JM Financial moved its recommendation to ‘Buy’ from ‘Add’.
The market reaction came against a quarter in which PhysicsWallah delivered double-digit revenue growth, narrowed its losses and moved EBITDA back into positive territory.
JPMorgan keeps Rs 148 target after upgrade
JPMorgan retained its Rs 148 target price while raising its rating on PhysicsWallah to Overweight.
The brokerage highlighted that the company’s performance came in ahead of expectations despite disruption linked to NEET. It also pointed to PhysicsWallah’s revenue growth guidance while reassessing its view on the stock.
JM Financial also became more positive, upgrading PhysicsWallah to Buy while maintaining a target price of Rs 140. Its assessment was supported by improving fundamentals and what it viewed as a more favourable risk-reward equation following the stock’s recent correction.
The two upgrades placed the focus back on the company’s operating performance rather than simply the day’s share-price movement.
Revenue crosses Rs 1,000 crore in Q1 FY27
PhysicsWallah reported operating revenue of Rs 1,054 crore in Q1 FY27, up 24.4% from Rs 847.1 crore in the same quarter a year earlier.
The improvement was accompanied by a significant reduction in losses. Net loss narrowed 30.5% year-on-year to Rs 88.3 crore.
EBITDA also turned positive during the quarter after the company had reported an EBITDA loss of Rs 21 crore in Q1 FY26. The adjusted EBITDA margin widened sharply to 12.9% from 3.1% a year earlier, showing that revenue growth was accompanied by a stronger operating profile.
That margin expansion is an important part of the quarter’s story. For a business still reporting a net loss, the shift to positive EBITDA and the improvement in adjusted margins give investors another measure of how the operating economics are changing as the company grows.
K-12 and early-learning revenue jumps 88%
Growth was not limited to the headline revenue number.
The company’s main business remained its largest growth driver, posting a 33% year-on-year increase in revenue. At the same time, the K-12 and early-learning segment recorded one of the strongest growth rates disclosed for the quarter, with revenue jumping 88% to Rs 105 crore.
The rise in K-12 and early learning gives PhysicsWallah another area of expansion alongside the test-preparation operations for which the company is better known.
PhysicsWallah increases stake in Sarrthi IAS
PhysicsWallah is also expanding its presence in the civil services preparation market.
The company approved a Rs 71.8 crore investment in UPSC coaching platform Sarrthi IAS, increasing its stake from 40% to 51% and making the business a subsidiary.
The investment is expected to strengthen PhysicsWallah’s position in UPSC and civil services examination preparation as the company broadens its operations beyond its existing test-preparation business.
The transaction adds another dimension to PhysicsWallah’s growth plans at a time when its quarterly numbers are already showing expansion across multiple education categories.
Stock remains below the day’s Rs 128.35 level
While PhysicsWallah shares climbed to Rs 128.35 following the brokerage upgrades, they were later trading at around Rs 123.83. At that price, the company’s market capitalisation stood at approximately Rs 35,919 crore, or $3.78 billion.
The latest quarter therefore leaves investors with several numbers to weigh at once: 24.4% revenue growth, a narrower net loss, positive EBITDA, a 12.9% adjusted EBITDA margin and rapid expansion in K-12 and early learning.
For now, JPMorgan and JM Financial have responded to that combination by moving to more positive ratings while keeping their respective price targets unchanged.
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