Aakash Educational plans to invest up to Rs 1,000 crore in AI, digital push

Aakash Educational Services is planning to invest ₹800 crore to ₹1,000 crore over the next three years to enhance its infrastructure, digital capabilities, and AI-driven learning platforms, said Deepak Mehrotra, MD and CEO, Aakash Educational Services here on Monday.

 

The New Delhi-based education provider, which started in 1988, is now ramping up its presence in smaller Indian towns, betting on the growing demand for quality coaching in Tier-3 and Tier-4 cities.

 

The company, backed by investors including Manipal Systems and Blackstone, provides preparatory services, mainly to students preparing for medical and engineering entrance exams, and is now rolling out new centres, digital platforms, and AI-driven learning programmes as part of its "Aakash 2.0" strategy.

 

The expansion comes amid a consolidation in India’s edtech sector, following a post-pandemic surge and subsequent slowdown. Many players that aggressively expanded into physical coaching are now scaling back or shutting down. Aakash, however, sees a strong opportunity in smaller towns, where demand is rising.

 

The company is aiming for online and hybrid learning to contribute 20-25 per cent of revenue in the next four years, up from 5 per cent currently.

 

Mehrotra noted that a primary challenge when it comes to Tier-3 and Tier-4 cities is convincing parents that children will receive the same quality of education that one gets in bigger cities. 

The company has seen a surge in enrollments from female students in these regions, as parents increasingly prioritise their daughters' education when local coaching options are available.

 

“Our last phase of expansion was into these smaller towns, but these are not Tier-4, and we have upwards of 35 per cent students, which are girl children,” said Mehrotra.

 

Blackstone recently withdrew a petition regarding changes in shareholder rights. The dispute stemmed from an NCLT order halting Aakash’s attempt to amend its Articles of Association (AoA) during an EGM. Blackstone-backed Singapore Topco, which holds a 6.8 per cent stake, claimed the changes would dilute its investment and devalue Aakash.

 

“We will resolve more concerns that investors have with each other and hopefully will be able to get the investments with the right kind of debt equity mix which will enable us to invest more aggressively in the Akash 2.0 agenda that we have,” said Mehrotra.

 

“All this is working towards trying to build a consensus where the investors talk to each other rather than talk at each other, and that enables us to have a more enabling conversation to drive investments that we need to take Aakash to the next level,” he added.