PWL

PWL reported a robust 26% YoY revenue growth to ₹1,051 crores in Q2 FY26, its first quarter as a listed entity. Adjusted EBITDA margins expanded by 300bps to 26%, driven by operational leverage and a shift in marketing strategy. The company's PAT surged 70% YoY to ₹70 crores, demonstrating that its low-cost 'Bharat' model can generate significant bottom-line results.

Management provided a detailed breakdown of their offline center model, which requires an initial investment of ₹2.5 crores per center. While centers typically operate at a -6% EBITDA margin in their first year with ~1,500 students, they reach 6% margin in year two and 13-15% by year three as enrollment scales to ~3,500 students. Currently, 72 out of 117 Vidyapeeth centers are already profitable, with the entire offline segment expected to be EBITDA positive by FY27.

PWL is rapidly reducing its dependency on the JEE and NEET categories, which now account for 31% of total enrollment, down from 36% in 2024. The company is successfully expanding into government exams, UPSC, and K-10 segments. Management noted that while these new categories often have lower ARPUs due to shorter course durations, they benefit from the same 'freemium' funnel that keeps customer acquisition costs low.

The company has optimized its marketing spend by concentrating expenses during peak enrollment months (Q1 and Q2) rather than uniform quarterly spending. This resulted in an H1 marketing spend of ~10%, with a full-year target of 8-9%. Additionally, AI is driving significant efficiencies in doubt-solving and content creation, leading to a 27% attrition rate in support staff as the company chooses not to backfill roles replaced by technology.

PWL plans to open approximately 200 new centers over the next three years, maintaining a run rate of ~70 centers per year. This expansion is highly data-driven, with 80% of offline admissions originating from the existing online learner base. Management emphasized that they prefer a 'build from scratch' approach over M&A, though they remain open to acquisitions that provide specific geographical or categorical expansion, such as their recent 40% stake in Sarrthi IAS.