Table of Contents
At Chavi Medical, a pharmacy on an arterial road in Kota flanked by study centres, the boy at the counter echoed Ali’s sentiments, albeit through a different lens. “If there are no students, who will suffer from dengue, malaria, fever and cold? How will this medical shop run?” he asked, making it clear that as far as he is concerned, ill-health is wealth.
Kota, which welcomed aspiring pupils from every corner of the country for years, is today a shadow of its former self. Gone are the lakhs of hunched students jostling with bags and umbrellas with the names of the institutes emblazoned on them. According to teachers and coaching centres, the inflow of students this year has been pegged at 70,000-90,000 compared to 200,000 in 2022, owing to institutes opening centres in cities across the country.
View Full Image
Allegations of irregularities in the National Eligibility Entrance Test (NEET) have not helped matters—60% of the students in Kota show up to prepare for the medical entrance exam. While students were dismayed at the prospect of having to take the test afresh, for a brief while the institutes in Kota had their hopes up, hoping this would spark an inflow. The Supreme Court, however, put paid to those hopes when it nixed the idea of having a retest.
Kota’s economy, once a beehive of activity, has been brought to its knees by the travails of the ‘coaching’ industry. Vacant classrooms, loan defaults, a property price crash, teachers selling their homes, renegotiated shop leases, and taxi/autorickshaw drivers idling at the railway station are the norm today.
The fates of people across trades are interlinked with the intake of students, and this is evident from the sharp decline in their earnings. Ali’s monthly takings have plunged 80%; spice distributor Ravi Prakash Taparia’s sales are down 30%; Aashirwad hostel owner Naveen Mittal is struggling with 50% occupancy; exam testing lab Digital Desk’s computers are lying unused; and a senior physics teacher is working at 60% of his earlier salary.
View Full Image
Two years ago, the picture painted above would have been impossible to conceive. At the time, the coaching institutes in the nerve centre of India’s coaching industry were engaged in a brutal poaching war to attract teachers and students. Lesson learnt, they have now taken a different approach.
Home advantage
The primary reason for Kota’s decline today is coaching institutes opening centres in other cities in the last two years, which has had a cascading effect on local businesses. Allen Career Institute, for instance, now has centres in at least 60 cities across India, including Dibrugarh, Patna, Rohtak, Latur, Jodhpur and Durgapur. Unacademy’s website says it has 61 centres in 44 cities for offline preparation, including Ahmedabad, Bhopal, Bhubaneswar, Bengaluru, Dehradun and New Delhi. Physics Wallah has 124 centres in 105 cities, with its Kota centre opening in 2022. It has more than 200,000 students enrolled across these centres.
View Full Image
“Our efforts to reduce pressure on traditional education hubs like Kota involve opening multiple centres in Uttar Pradesh, Bihar, Maharashtra, Madhya Pradesh, and Rajasthan,” said Ankit Gupta, chief executive officer (CEO), Physics Wallah Offline, in response to Mint’s queries.
“We have doubled our admission numbers in these centres by bringing education to students’ doorsteps, and improving their emotional and psychological well-being as they remain closer to the comfort of their homes. Furthermore, students can save on migration expenses, reducing the financial burden on their parents,” Gupta added.
While the studying fees for medical/engineering tests oscillate between ₹1.5- ₹1.8 lakh a year, hostel charges are separate, and can go up to ₹2 lakh a year. But thanks to centres opening close to their homes, this is no longer an outgo for students, much to the detriment of Kota’s many hostels.
The other reason for the drop in students in Kota is the image it has developed of being a “suicide and party” hub. According to a Hindustan Times report last month, at least 13 students preparing for NEET or the engineering Joint Entrance Examination (JEE) in Kota had taken their own lives as of July. Last year, 27 suicides were reported, which was the highest number since 2015, said officials.
The other reason for the drop in students in Kota is the image it has developed of being a “suicide and party” hub. Last year, 27 suicides were reported.
“There are three types of students who come to Kota: the first lot are the ones who want to and will excel; the second are regular students who want to get a seat in a college, and the third group is students whose parents want them out of the house,” said Pramod Maheshwari, who set up the Career Point coaching centre in 1993. He is now chairman, managing director and CEO of Career Point, which was listed in 2010.
The party scene in Kota started when students began sharing living quarters in flats. There are also bars that turn into a party zone at night. Worse, there are incidents of drugs allegedly changing hands over the boundary walls of hostels.
Not teachers’ day
Over the last few decades, teachers have been poached in large numbers in Kota to deal a body blow to rival coaching institutes. Allen Career Institute, Vibrant Academy, Motion Education, Resonance Eduventures, Reliable Institute (now backed by Allen), Aakash Institute, Career Point, Physics Wallah, and Bansal Classes have seen teachers swap loyalties overnight for 50-60% hikes.
In 2022, for instance, teachers in the city were sucked into a game of musical chairs. Softbank backed Unacademy poached some of Allen’s best teachers. Founded in 2015 by Gaurav Munjal, Roman Saini and Hemesh Singh, Unacademy started as a YouTube channel making educational videos. It grew exponentially during the pandemic lockdowns, as students switched to online learning.
View Full Image
Career Point lost its teachers to Physics Wallah, which was offering huge salaries. Meanwhile, Allen Career also played a big part in the poaching war by hiking salaries to retain and attract talent. The institute was started in 1988 by Rajesh Maheshwari, who chose to call it Allen as it was a classy name and a catchier version of the initials of his father, L.N. Maheshwari.
With the student intake at less than half the earlier level today, institutes across the board have slashed salaries. “Due to the drop in number of students, Unacademy has slashed salaries of its faculty,” said a senior teacher at the institute. “In 2022, we came with families so that no one could identify us as candidates for a job interview. How times change,” he said, sitting in a room in the Country Inn & Suites by Radisson, the very hotel at which he had attended the Unacademy job interview a couple of years earlier.
Till date, Unacademy has raised $877 million in funding from SoftBank Group, Temasek, Blume Ventures, Peak XV Partners and Nexus Venture Partners, among others. But since 2022, it has recorded multiple rounds of layoffs, affecting at least 2,000 employees, as Mint reported last month. And this year, it has cancelled appraisals, as conveyed by Munjal to employees a few days ago.
Today, they are bringing in teachers who have just graduated for less than ₹10 lakh. They can barely solve the entrance papers.
— A senior teacher
In 2022-23, the test-prep platform trimmed its losses to ₹1,678 crore from ₹2,847 crore a year earlier, but that was still nearly double its revenue of ₹907 crore that financial year.
Physics Wallah’s Gupta said the institute has maintained the salaries of all faculty and staff at its Kota centres, “despite a 15% expected decrease in admission numbers for academic year 24-25 compared to 23-24″. In June 2022, Physics Wallah raised $100 million from Westbridge Capital and GSV Ventures.
Allen Career, meanwhile, reduced the fixed pay of its teachers by 20-40% in June, faculty members told Mint. The institute, which had more than 10,000 teachers and administrative staff two years ago, today has less than 4,000.
“Six hundred teachers have signed a letter on why the salary cut was unacceptable to them but there has been no meeting since the cuts were announced in June. There are WhatsApp groups where teachers are trying to arrange money for medical treatments,” said a physics teacher at Allen. “Some bought homes and cars when they got the big hikes in 2022 and now cannot pay for them.”
Physics Wallah has maintained the salaries of all faculty and staff at its Kota centres despite a 15% expected decrease in admission numbers for academic year 24-25.
In the good times, it paid to be a teacher in Kota. Teachers at Allen were said to earn ₹15 lakh to over ₹1 crore annually. During the poaching war, Unacademy allegedly hired some teachers at ₹5-6 crore for a three-year deal (which has now been yanked). Those teaching at Physics Wallah, Career Point, Motion etc earn ₹15-25 lakh annually, on average.
“Today, they are bringing in teachers who have just graduated for less than ₹10 lakh. They can barely solve the entrance papers and now will replace us,” lamented a chemistry teacher, who has resigned from one of the top coaching centres in the city.
Allen declined to comment while mails sent to Resonance Eduventures, Motion Education, Unacademy and Aakash Institute remain unanswered.
A depleted city
View Full Image
Hostels, which at one time were at full capacity, today have “rooms available” posters plastered on every side. “My hostel fees were reduced from ₹19,000 a month to ₹13,000 since there are no takers. If I had known the place would be so empty, I would have studied from the institute’s centre in Chhattisgarh,” Rishika, a student from Chhattisgarh, told Mint.
She had arrived a few months ago, following in the footsteps of her high school seniors. “Our physics teacher left and we are yet to get a replacement. There are very few students in the class and I will return to Chhattisgarh after Diwali and take my class 12 exams from there,” said the despondent 17-year-old.
Kota is made up of three to four zones. One section, commonly called Coral Park, looks like a ghost city. It was built right across one of Allen’s centres for students taking the NEET exam. Builders bought plots for the development at ₹10,000/sft two years ago. Today, there are no buyers and the rates have fallen below ₹3,000/sft. The buildings, meant for 25,000 students, house barely 7,000.
The floors are polished, the beds still have plastic sheets on them, and the smell of new woodwork permeates most of the flats. In many of the one-room flats, which are about 250 sft in size, there is a kitchenette, a fridge, a study table and two beds, which are now available for just ₹13,000 a month.
View Full Image
“Hostel owners have put in ₹2-4 crore in each building,” said Naveen Mittal, president of a Hostel Association in Kota. He has hostels in Coral Park and Old Rajeev Gandhi Nagar and both are running at 50% capacity.
“Shopkeepers who took up space below the buildings to open up grocery and stationery stores to cater to the students do not have money to pay. Negotiations are on with landlords to reduce the monthly rentals from ₹25,000 to ₹10,000. But landlords are afraid that if they default more than three times, their buildings will be locked up by the banks,” Mittal added.
As per the Hostel Association’s estimates, there are 4,000 hostels in Kota, 5,000-6,000 rooms let out for paying guests, and 10,000-12,000 flats where students can live, sometimes with families. The hostels came up at a rapid pace in newer parts of the town, such as Coral, to cater to the rising demand from students preparing for NEET.
One trick pony
Coaching institutes have to sustain student engagement and weekly tests are part of the schedule. In 2019, Vijendra Chaturvedi opened Digital Desk, a testing lab where 900 students can take a weekly test in a two storeyed building. There are rows of computers with cameras fitted so that students can be monitored constantly. The coaching centres pay Chaturvedi for the tests, depending on the number of students who take them. “Over the last few months, just 450-500 students have come in. We had just started this and the pandemic hit us, and now the dropouts,” said Chaturvedi.
View Full Image
Some are upset that coaching has turned Kota into a one-trick pony and seemingly diminished every other industrial opportunity in the region. “There need to be more industries. Today, as a distributor of MDH spices in Kota, I am dependent on students because they are the largest customer base in hotels, hostels, cafes. The latter are going empty, and as a result my sales have dropped by 30%,” said Ravi Prakash Taparia, who has been a distributor since 1972.
But, not everyone is perturbed. “The crowds are less and only those who really want to study have come. For the last three years, students bagging the top ranks were not from Kota, and that needs to change,” said Sameer Bansal of Bansal Classes.
View Full Image
His father, a former IITian who passed away in 2021, had set up Bansal Classes in 1984. It is said that most of the established coaching centres in Kota trace their origins to Bansal Classes, as the teachers were either trained by ‘Bansal Sir’ or were his students.
Today, Sameer’s Kota centres train about 500 students and he too has a franchise system in other states for Bansal Classes. A smattering of students wearing shirts that say ‘Bansalite today, IITian tomorrow’ or ‘Bansalite today, Doctor tomorrow’ walk along the corridors.
Like Sameer, there are others who believe Kota is going through a course correction, but that it will rise again. As the chemistry teacher cited earlier put it: “It will take a couple of years at least, but parents will realize that Kota was built by teachers—the branches outside cannot match up.”
