PhysicsWallah, the renowned edtech unicorn, is reportedly in advanced negotiations to acquire Drishti IAS, a prominent player in civil services exam preparation. The deal, estimated to be valued between Rs 2,500 crore and Rs 3,000 crore, could become one of the largest acquisitions in India’s edtech sector in recent years.
Acquisition Details
If finalized, this acquisition will enable PhysicsWallah to expand its offerings beyond engineering and medical entrance coaching into the lucrative UPSC and state commission exam preparation market. The payment for the acquisition is expected to be made in tranches, linked to future performance milestones.
IPO Plans and Market Expansion
This development comes as PhysicsWallah gears up for an initial public offering (IPO). The Noida-based company aims to raise $500 million at a valuation of $5 billion. Recently, it appointed three independent directors as part of its IPO preparations.
The acquisition aligns with PhysicsWallah’s strategy to enhance its offline education presence. The startup aims to generate Rs 1,000 crore in offline revenue by FY25, marking a significant shift towards hybrid educational models.
Drishti IAS: A Strong Contender
Founded by Vikas Divyakirti, Drishti IAS has been a key player in civil services coaching for over 26 years. In FY24, it reported revenues of Rs 405 crore and profits of Rs 90 crore. Its flagship center in Mukherjee Nagar accounts for a substantial portion of its revenue, making it an attractive asset for PhysicsWallah.
Despite the buzz surrounding the acquisition, Drishti IAS CEO Vivek Tiwari has dismissed reports as mere rumors that should not be taken seriously.
PhysicsWallah’s Growth Trajectory
PhysicsWallah has evolved from a YouTube-based platform into a comprehensive hybrid edtech company. It offers live and recorded lectures, test series, and offline centers. The startup has raised over $300 million and was valued at approximately $2.8 billion following a Series B funding round last year.
While its revenue surged to Rs 1,940 crore in FY24 from Rs 744 crore in FY23, losses also increased significantly to Rs 1,131 crore due to heightened investments in technology and expansion efforts.