Education

Shares of PhysicsWallah ended today’s trading session 15.6% higher at ₹106.50 apiece on the BSE. Its market capitalisation stood at ₹30,763.6Cr (about $3.2 Bn) at end of the day. Original Story | June 4, 2026, 12:13 IST Edtech major PhysicsWallah has rolled back its plan to provide financing to students through its wholly owned NBFC subsidiary, FinZ Finance. In a statement today, the Alakh Pandey-led company said it is restructuring its lending strategy and has tied up with multiple “leading” regulated third-party NBFCs to enable student lending needs. “This decision reverses the company’s earlier approach and is intended to materially reduce balance sheet and credit related risks for the company,” the company said. Notably, the company’s shares were under pressure since it announced its decision to infuse ₹120 Cr into FinZ Finance last week. Following the announcement today, the shares surged as much as 17.8% to touch an intraday high of ₹108.45 on the BSE.  “We received feedback from our partners that our core strength lies in building communities and our online business. Our lending business is best left to regulated third-party NBFCs who have created robust underwriting capabilities,” PhysicsWallah cofounder Prateek Maheshwari said on the change in the company’s plans. The edtech major said it will continue operating as a technology platform that connects PhysicsWallah students with a curated network of regulated lending partners, with loan offerings tailored to a student’s learning lifecycle and academic progress.  The company added that the objective is to improve affordability and accessibility while making the financing model more scalable and better integrated into its student ecosystem. On FinZ Finance, PhysicsWallah said the future strategic direction of the NBFC arm will be decided in the near term, subject to approval from the board and relevant regulatory authorities. Last week, PhysicsWallah reported a 76% decline in its consolidated net loss to ₹69.1 Cr in Q4 FY26 from ₹289.3 Cr in the same quarter last year. The edtech major had posted a profit of ₹102.3 Cr in Q3 FY26. Operating revenue for the quarter rose 51% YoY to ₹918.8 Cr. Sequentially, it declined 15% from ₹1,082.4 Cr.

The Central Consumer Protection Authority (CCPA) has imposed a penalty of ₹5 Lakh on edtech major PhysicsWallah for using dark patterns on its platform, including a pre-selected donation option through which it collected about ₹2.47 Cr from more than 21.36 Lakh users. In an order dated June 1, the consumer watchdog said PhysicsWallah (PW’s) website and app deployed practices that violated the Consumer Protection Act, 2019, the E-Commerce Rules, 2020, and the government’s dark pattern guidelines. The case was initiated suo motu by the regulator after it examined PW’s platform and identified concerns around its checkout process and access to courses advertised as free. According to the order, PW automatically added a ₹10 donation to purchases through a pre-ticked “Donate for PW Foundation” checkbox. Users had to manually deselect the option to avoid the additional charge. The feature remained active between February 2024 and December 2025 and generated approximately ₹2.47 Cr in donations, the authority said. The regulator classified the practice as “basket sneaking”, a dark pattern that involves adding charges to a transaction without obtaining explicit consent from consumers. The CCPA also objected to messaging displayed alongside the donation option, which highlighted charitable activities such as funding marriages for needy individuals, supporting children’s education and providing healthcare assistance.  According to the authority, the messaging could influence users to retain the donation through guilt and amounted to “confirm shaming”. Collecting Data Without A Cause Separately, the regulator found that users were required to provide their mobile number and email address to access courses marketed as free. Following tests conducted using multiple accounts, the authority concluded that the information was not necessary to provide access to the content and categorised the practice as “forced action”. The order noted that PW had informed the authority that corrective changes had already been implemented. However, during an inspection conducted on December 22, 2025, the CCPA found that the donation option continued to remain selected by default. The edtech startup argued that the donation feature was clearly disclosed and that users were free to opt out. It also claimed that nearly 64% of users chose not to donate, indicating that consumers were aware of the option. The authority rejected the argument, stating that visibility does not amount to consent and that consumers must take an affirmative action before an additional charge can be imposed. PW also compared its registration requirements for free courses with government-backed education platforms such as DIKSHA and SWAYAM.  The consumer protection body dismissed the comparison, saying those platforms require user information for specific purposes such as assessments and certifications, whereas PW failed to demonstrate why the data was necessary to access the content.   The CCPA held that PW violated provisions relating to consumer rights, misleading advertisements and unfair trade practices under the Consumer Protection Act. The authority directed the company to discontinue all dark patterns across its platforms, pay the penalty and submit a compliance report within 15 days. The CCPA, on the same day, also fined McAfee ₹1 Lakh for dark patterns around subscription renewal where it only offered “Accept Risk” or “Renew Now”, with no neutral “Cancel” or “Skip” option.   The orders come at a time when the Centre is stepping up scrutiny of dark patterns across India’s digital economy. Over the past year, the CCPA has taken action against multiple internet companies, including Zepto, Flipkart and FirstCry, for practices ranging from basket sneaking and drip pricing to misleading subscription flows. The move also follows industry-wide concerns about the widespread use of dark patterns. A survey by LocalCircles found that only a small fraction of major ecommerce platforms operating in India were free of dark patterns, despite the government’s guidelines coming into force in 2023.

Edtech startup Klassroom is planning to launch its initial public offering (IPO) on the BSE SME platform in the second quarter (July to September) of FY27, sources shared with Inc42. The startup, which filed its DRHP in February, received the in-principle approval from BSE to go ahead with its public offering in May, as per BSE data. The proposed IPO comprises a fresh issue of up to 19.89 Lakh equity shares and an offer-for-sale (OFS) of up to 4.66 Lakh shares.  Klassroom plans to use ₹5.35 Cr to bolster content development, specifically sharpen its educational video production, subtitles/audio review, and skill-based courses including AI & ML, Agentic AI, sales training and customer support programmes. It also ₹1.68 Cr towards cloud hosting, APIs, backend infra, AI engineers, app maintenance and integrations with universities/government systems. Founded in 2016 by Alka Javeri and her sons Dhruv and Dhumil Javeri, Klassroom operates a hybrid learning platform that combines offline coaching centres with an education OTT app. The startup claims to have more than 4 Lakh registered users, over 1 Lakh subscribers and a network of 30 partner centres across the country. Klassroom generates revenue through a mix of direct consumer subscriptions, partner centres, enterprise partnerships and government projects. Apart from academic coaching programmes, it also works with state governments, universities and private organisations on digital learning, teacher training, AI labs and skilling initiatives. The company had reported a sharp improvement in its financial performance ahead of the planned public listing. According to its DRHP, Klassroom posted an operating revenue of ₹12.4 Cr and a net profit of ₹4 Cr in the first half of FY26. In FY25, its operating revenue rose 120% year-on-year to ₹10.1 Cr, while profit increased nearly eightfold to ₹2.9 Cr.   The startup has raised more than $2 Mn from investors including LetsVenture, ah! Ventures, Growth Sense, CPT Family Trust among others. If launched as planned, Klassroom will join a growing list of venture-backed startups heading to the public markets. The development comes amid a slow down in startup IPOs amid broader market volatility. While six new-age tech companies, including Aequs, Kissht, Aye Finance, have gone public in 2026, many are pushed to reevaluate their public listings bid. For instance, companies like Cure Foods, PhonePe and Flipkart have already put their listing ambitions on hold.