Test preparation platform Allen Career Institute’s net profit plunged by nearly two-thirds in fiscal 2025, even as total revenue remained flat.
A shift in the business profile away from Kota, coupled with significant investments in its digital arm, new centres and hiring talent and faculty, weighed on the performance, chief executive Nitin Kukreja told ET.
The educational institution posted a net profit of Rs 41 crore, compared with Rs 136 crore in FY24, Kukreja told ET. Operating revenue fell to Rs 3,067 crore from Rs 3,245 crore, while total revenue stood at Rs 3,307 crore.
“We're investing in tech-led growth, we're also investing in building out centres across the country, and the financials incorporate the impact of those expansions and investments as well,” he said.
What used to be a Kota-focused business now derives nearly 75% of its revenue from outside the Rajasthan city known for its coaching centres that prepare students for competitive entrance exams. With pandemic-related disruptions and rising student suicide cases affecting the city’s reputation, and the rise of edtech platforms impacting enrolments, Allen has been expanding aggressively into other places to capture new demand.
“While Kota revenue may have shrunk, the rest of India and digital segments have grown, which is why Kota’s contribution has declined from around 36% to 25% over the course of this year,” said Kukreja, who took over as CEO in 2023. In FY25, Allen saw about 90,000 enrolments in its Kota centres.
Founded in 1988, Allen, which specialises in preparing students for engineering and medical entrance exams along with Olympiads, runs more than 300 coaching centres across 70 cities. Its key markets include Bengaluru, Delhi, Chandigarh, Ahmedabad, Bhubaneswar, Lucknow, Patna, Chennai and Hyderabad. At present, it has around 350,000 students in the offline centres, Kukreja said.
Speaking on the test preparation market, Kukreja said the number of quality seats in engineering and medical colleges is always limited compared to the number of applicants. There are around 60,000 seats in government medical colleges and about 17,000 IIT seats, supplemented by other engineering colleges, catering to a student base of 6-7 million preparing for these exams.
The financial year ended March 2025 had seen layoffs at Allen, with it reportedly letting go of around 200 employees in December. In April 2024, ET reported that the company had cut 60-70 roles from the sales team of its medical test prep division, Allen NexT.
“Kota’s strength had declined, leading to a rebalancing of resources. The fact is, we relocated many of our faculty from Kota to other centres where we were expanding. Over the last three years, our faculty count has grown from 5,000 to 7,000,” he added.
In the test prep segment, it competes with the likes of Manipal Group-controlled Aakash Institute, Physicwallah and Unacademy.
To be sure, Allen probably remains the only profitable player in this segment. In FY25, IPO-bound PhysicsWallah reported revenue of Rs 2,886 crore, up from Rs 1,940 crore in FY24, while its losses reduced significantly to Rs 243 crore from Rs 1,131 crore the previous year. Meanwhile, Unacademy, whose founders are moving away from test prep to their language learning app Airlearn, reportedly saw its total revenue fall 16% to Rs 826 crore in FY25. The company has yet to file its financials with the RoC. Aakash hasn't filed its results since FY23.
In 2022, Allen Career Institute received an investment of $600 million from Bodhi Tree Systems to help scale up and leverage digital technology. Bodhi Tree Systems now holds a 36% stake in the institute.
Allen Digital, the company’s online arm, was launched in 2022, at a time when companies such as Byju’s and Unacademy dominated the segment. It now has around 1 million active users, half of them paying subscribers, according to the company. On September 24, ET reported that Rakesh Ranjan, former chief executive of Eternal-owned food delivery platform Zomato, joined Allen Digital as its new CEO.
According to Kukreja, the new centres and investment initiatives are expected to drive growth.
“It is physically impossible to have a good school, a good coaching institute, or a good tutor in every corner of India and deliver meaningful learning outcomes at the scale the country deserves. The only way to achieve this is through technology,” he said, adding that the company will focus on strengthening academic delivery before chasing growth.
A shift in the business profile away from Kota, coupled with significant investments in its digital arm, new centres and hiring talent and faculty, weighed on the performance, chief executive Nitin Kukreja told ET.
The educational institution posted a net profit of Rs 41 crore, compared with Rs 136 crore in FY24, Kukreja told ET. Operating revenue fell to Rs 3,067 crore from Rs 3,245 crore, while total revenue stood at Rs 3,307 crore.
“We're investing in tech-led growth, we're also investing in building out centres across the country, and the financials incorporate the impact of those expansions and investments as well,” he said.
What used to be a Kota-focused business now derives nearly 75% of its revenue from outside the Rajasthan city known for its coaching centres that prepare students for competitive entrance exams. With pandemic-related disruptions and rising student suicide cases affecting the city’s reputation, and the rise of edtech platforms impacting enrolments, Allen has been expanding aggressively into other places to capture new demand.
“While Kota revenue may have shrunk, the rest of India and digital segments have grown, which is why Kota’s contribution has declined from around 36% to 25% over the course of this year,” said Kukreja, who took over as CEO in 2023. In FY25, Allen saw about 90,000 enrolments in its Kota centres.
Founded in 1988, Allen, which specialises in preparing students for engineering and medical entrance exams along with Olympiads, runs more than 300 coaching centres across 70 cities. Its key markets include Bengaluru, Delhi, Chandigarh, Ahmedabad, Bhubaneswar, Lucknow, Patna, Chennai and Hyderabad. At present, it has around 350,000 students in the offline centres, Kukreja said.
Speaking on the test preparation market, Kukreja said the number of quality seats in engineering and medical colleges is always limited compared to the number of applicants. There are around 60,000 seats in government medical colleges and about 17,000 IIT seats, supplemented by other engineering colleges, catering to a student base of 6-7 million preparing for these exams.
The financial year ended March 2025 had seen layoffs at Allen, with it reportedly letting go of around 200 employees in December. In April 2024, ET reported that the company had cut 60-70 roles from the sales team of its medical test prep division, Allen NexT.
“Kota’s strength had declined, leading to a rebalancing of resources. The fact is, we relocated many of our faculty from Kota to other centres where we were expanding. Over the last three years, our faculty count has grown from 5,000 to 7,000,” he added.
In the test prep segment, it competes with the likes of Manipal Group-controlled Aakash Institute, Physicwallah and Unacademy.
To be sure, Allen probably remains the only profitable player in this segment. In FY25, IPO-bound PhysicsWallah reported revenue of Rs 2,886 crore, up from Rs 1,940 crore in FY24, while its losses reduced significantly to Rs 243 crore from Rs 1,131 crore the previous year. Meanwhile, Unacademy, whose founders are moving away from test prep to their language learning app Airlearn, reportedly saw its total revenue fall 16% to Rs 826 crore in FY25. The company has yet to file its financials with the RoC. Aakash hasn't filed its results since FY23.
In 2022, Allen Career Institute received an investment of $600 million from Bodhi Tree Systems to help scale up and leverage digital technology. Bodhi Tree Systems now holds a 36% stake in the institute.
Allen Digital, the company’s online arm, was launched in 2022, at a time when companies such as Byju’s and Unacademy dominated the segment. It now has around 1 million active users, half of them paying subscribers, according to the company. On September 24, ET reported that Rakesh Ranjan, former chief executive of Eternal-owned food delivery platform Zomato, joined Allen Digital as its new CEO.
According to Kukreja, the new centres and investment initiatives are expected to drive growth.
“It is physically impossible to have a good school, a good coaching institute, or a good tutor in every corner of India and deliver meaningful learning outcomes at the scale the country deserves. The only way to achieve this is through technology,” he said, adding that the company will focus on strengthening academic delivery before chasing growth.
