Once India's Most Valuable Startup, Byju's Valuation Slashed 95% To $1 Billion By BlackRock

The days seem to going from bad to worse for Byju's, which was once India¡¯s most valued startup, From inability to pay staff's salaries, reeling under crores of debt and mounting losses to now being devalued by 95% and that too by world's largest asset manager, the days aren't getting any easier for the edtech giant.

BlackRock Slashes Byju's Valuation By 95%

byju valuation slash 95 percent blackrock/indiatimes

World's largest asset manager BlackRock has slashed the implied valuation of Byju¡¯s from $22 billion to just about $1 billion. Back in October 2022, Byju's was India's most valuable startup,valued at $22 billion.

In a regulatory filing with the US Securities and Exchange Commission (SEC) earlier this year on January 5th, BlackRock massively slashed down the valuation of its shares in Byju¡¯s parent Think & Learn, for the third time during the course of 2023, at $209.57 per piece for the quarter ended October, as per ET report.

This turns out to make Byju's valuation just $1 billion, down from its valuation of $8.2 billion at the end of the March quarter. At its peak in October 2022, each share was valued at $4,660. BlackRock holds less than 1% stake in Byju's parent company.

Also Read: Byju's Asked To Pay 9,000 Crore For Foreign Funding Laws Violation

Struggles Continue For Byju's

blackrock byjus valuation slash/bloomberg

This 95% slash in valuation from what it was at its peak comes at a time when there have been growing concerns over the value in Byju's business. The edtech company, headquartered in Bengaluru, has experienced a notable decrease in its operational scale in the past two years and is considering the sale of group assets in order to pay off debt. Byju Raveendran, the company's founder, has been having trouble finding new funding, which has caused delays in November salary payments and other operational issues.

Last month, he had assured a group of senior staff members that the cash crunch should end in 45¨C60 days. Prosus reduced Byju's valuation to less than $3 billion in November, from the $5.1 billion it had assigned the company in March of the previous year. The Dutch investor owns less than ten percent of the edtech company.

Also, its known that Byju's has been under fire for allegedly misrepresenting its course offerings and for taking too long to disclose its financial results. It is still negotiating terms with the lenders of its $1.2 billion term loan B, despite notices from the Enforcement Directorate regarding possible violations of the Foreign Exchange Management Act.

Sitting Deep Into Crores Of Losses

byjus valuation/bccl

Citing people present in the company¡¯s annual general meeting, an ET report had mentioned last month that Byju's parent company, Think and Learn, is projected to have recorded a consolidated loss of over Rs 8,200 crore in 2021¨C2022 despite a revenue exceeding Rs 5,000 crore, The write-off of the Whitehat Jr. subsidiary, which it acquired for $300 million in 2020, accounts for up to half of the loss. The audited FY22 earnings have not yet been submitted to the Registrar of Companies (RoC).

On the other hand, investors in Byju have also insisted that the company submit its audited 2022¨C2023 results as soon as possible in order to receive their money back.

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