Joining a steady wave of Indian startups tapping the public markets, Mumbai-based edtech firm Fusion Klassroom Edutech Limited (operating simply as Klassroom) has secured in-principle approval from the Bombay Stock Exchange (BSE) for its proposed initial public offering (IPO) on the exchange’s SME platform.
The regulatory milestone arrives roughly three and a half months after the company originally filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) and the exchange in February 2026. In anticipation of the public listing, the company transitioned from a private entity into a public limited company in November 2025.
The IPO Structure: Deep Dive into the Shares
According to the company’s updated offer filings, the book-built public issue will consist of up to 24.55 lakh equity shares (with a face value of ₹10 each). The total layout is divided between new capital generation and an exit route for early investors:
- Fresh Issue Layer: Up to 19.89 lakh equity shares will be issued as fresh capital to inject liquidity straight into corporate operations.
- Offer for Sale (OFS) Layer: Up to 4.66 lakh equity shares are being offloaded by existing shareholders, which include the startup’s core promoters and early-stage angel investors.
- The Allocations: The underwriting framework mandates that not more than 50% of the net offer will be reserved for Qualified Institutional Buyers (QIBs), not less than 35% for retail individual investors, and at least 15% for Non-Institutional Investors (NIIs).
Narnolia Financial Services is acting as the sole book-running lead manager to steer the issue, while Maashitla Securities has been brought onboard as the official registrar. Exact listing dates, pricing bands, and lot sizes are expected to be announced over the coming weeks.
Deployment of Capital: Doubling Down on AI
Unlike legacy edtech firms burning cash primarily on expensive advertising campaigns, Fusion Klassroom’s DRHP outlines a highly technical utility blueprint for the fresh capital proceeds:
- AI & Infrastructure Overhaul: A significant chunk of the fresh capital (₹6.71 crore) is earmarked for technology upgrade loops, explicitly funding advanced AI/ML model development, server expansions, and cloud infrastructure architecture.
- Content Expansion: ₹5.35 crore will be deployed toward funding the capital expenditure required for fresh academic content creation.
- Debt Reduction: ₹2.36 crore will be used to prepay or repay outstanding corporate borrowings.
- Hardware & Marketing: The remaining pool will fund desktop and laptop procurement for the startup’s physical AI/ML labs, alongside localized marketing initiatives.
Business Model: The Asset-Light Hybrid Approach
Founded in 2016 by Alka Javeri, Dhruv Javeri, and Dhumil Javeri, Klassroom has positioned itself away from pure-play online apps by building a highly scalable, hybrid learning ecosystem.
The business model combines a subscription-based digital “Education OTT” mobile app (boasting more than 100 courses and priced accessibly between ₹1,250 and ₹3,000 per year) with a network of 30 offline physical partner learning centers across Mumbai. Catering primarily to students in Classes 8 to 12, alongside JEE, NEET, CA, and vocational training aspirants, the company relies on an asset-light, franchise-driven framework to scale into new urban markets. The platform currently commands over 400,000 registered users and an active paid subscriber base exceeding 100,000.
Financial Health: Rising Revenues, Surging Margins
At a time when many heavily funded edtech unicorns are grappling with deep financial distress, Fusion Klassroom’s audited financials present a starkly different, highly profitable growth trajectory:
[FY24 Revenue: ₹4.6 Cr] ───► [FY25 Revenue: ₹10.1 Cr] ───► [H1FY26 (6 Months): ₹12.4 Cr]
[FY24 Profit: ₹34.4 L] ───► [FY25 Profit: ₹2.9 Cr] ───► [H1FY26 (6 Months): ₹3.96 Cr]
- Top-Line Velocity: Operating revenue more than doubled to ₹10.11 crore in FY25 (up from ₹4.62 crore in FY24). Growth accelerated massively into the next cycle, with the company printing ₹12.37 crore in revenue for just the first six months of the financial year ended September 30, 2025.
- Bottom-Line Profitability: Net profit (Profit After Tax) skyrocketed from a minor ₹34.4 lakh in FY24 to ₹2.90 crore in FY25. For the half-year ended September 2025, net profit surged further to hit ₹3.96 crore, supported by a healthy six-month EBITDA baseline of ₹6.19 crore.
By demonstrating strong, compounding unit economics via a capital-efficient hybrid framework, Klassroom is positioned to test investor appetite for profitable, small-cap edtech alternatives when its subscription book officially opens to the public.