Edtech company PhysicsWallah Ltd is restructuring the lending operations of its wholly owned NBFC subsidiary FinZ Finance Pvt Ltd, with the subsidiary agreeing to sell and transfer a loan portfolio worth ₹95.79 crore to RBI-registered NBFC Auxilo Finserve Pvt Ltd.
The transaction will result in a substantial reduction in FinZ Finance’s lending operations and the partial closure of its lending business, according to a stock exchange disclosure by PhysicsWallah.
Loan portfolio sale to Auxilo
FinZ Finance entered into a deed of assignment with Auxilo Finserve on October 3, 2026 for the sale, transfer and assignment of the ₹95.79 crore loan portfolio.
The portfolio represents a substantial or major part of FinZ Finance’s total loan portfolio. The transition relating to the loans and borrowers covered by the assignment is expected to be completed within the next 60 days.
Auxilo Finserve, the buyer, is an RBI-registered NBFC primarily focused on the education sector. The consideration for the transaction is ₹95.79 crore.
PhysicsWallah shifts lending strategy
PhysicsWallah said the transaction is part of a broader strategic realignment aimed at focusing on its core business and optimising capital allocation.
Under the revised approach, lending activities are proposed to be facilitated through established and regulated third-party NBFCs, rather than being primarily undertaken through FinZ Finance.
The company said this model is expected to improve operational efficiency while reducing the associated balance-sheet and credit risks.
FinZ Finance had limited contribution to revenue
The disclosure also shows that FinZ Finance had only a limited contribution to PhysicsWallah’s financial performance in FY2026.
As of March 31, 2026, FinZ Finance reported ₹1.35 crore in total income, representing 0.04% of PhysicsWallah’s total income, while its net worth stood at ₹60.30 crore, or 1.18% of the listed entity’s net worth.
Revenue from operations was negligible because FinZ Finance had commenced business operations only in February 2026.
Lending operations to be curtailed
The transaction effectively marks a scaling back of PhysicsWallah’s direct NBFC-led lending operations soon after the company began restructuring the lending strategy of FinZ Finance.
PhysicsWallah had earlier disclosed on June 4, 2026 that it was restructuring the lending strategy of its NBFC segment. The latest transaction takes that strategy further by transferring a major portion of the loan book to an established external NBFC.
The company said the arrangement is intended to allow PhysicsWallah to remain focused on its core business, while lending can be facilitated through regulated third-party NBFCs.
What the transaction means
For PhysicsWallah, the move represents a shift away from carrying a significant lending book on its own NBFC platform. Instead, the company intends to leverage established NBFC partners for financing-related activities while concentrating capital and management attention on its core business.
For FinZ Finance, however, the ₹95.79 crore portfolio transfer represents a substantial contraction of its principal business activity—lending—with the company itself describing the move as an expected partial/piecemeal closure of lending operations