More Valuation Markdown for BYJU’S; BlackRock Slashes The Edtech’s Valn By 95% To $1 Bn
US-based asset manager BlackRock has significantly reduced the valuation of edtech major BYJU’S once again, this time by 95%, bringing it down from $22 billion to $1 billion. This markdown comes after Dutch investor Prosus also marked down the value of its stake in BYJU’S in November, taking the troubled company’s valuation to under $3 billion.
In October last year, BlackRock assessed BYJU’S shares at around $209.6 each, a significant drop from the peak value of $4,660 in 2022. BlackRock currently holds less than 1% of the edtech giant.
Prior to this markdown, in April, BlackRock slashed BYJU’S valuation by almost 50% to $11.5 billion, which was a sharp decrease from the $22 billion valuation in 2022.
BlackRock’s assessment saw the value of its shares in BYJU’S drop to $2,855 per share from $4,660 per unit in April 2022. However, it’s worth noting that BlackRock is not the only investor to significantly lower its valuation of the edtech company. In November, Dutch investor Prosus, which owns over 9% of BYJU’S, valued it at under $3 billion.
BYJU’S CEO Byju Raveendran reportedly requested its investors to inject $300 million into the company in exchange for a larger shareholding amidst various legal and governance challenges faced by the edtech firm.
BYJU’S, a decacorn in the edtech industry, has raised approximately $6 billion in funding from prominent investors such as the Qatar Investment Authority, General Atlantic, Sumeru Ventures, Vitruvian Partners, BlackRock, Peak XV Partners, Chan Zuckerberg Initiative, Tencent, and Tiger Global.
However, BYJU’S has been encountering a series of obstacles, including legal disputes with lenders over the repayment of a $1.2 billion Term Loan B, financial pressure, significant cash depletion, widespread layoffs, departures of key leaders, auditors’ resignations, and the exit of major stakeholders.
Furthermore, the Enforcement Directorate (ED) is investigating BYJU’S for alleged violations of the Foreign Exchange Management Act (FEMA).
BYJU’S held its annual general meeting (AGM) recently, where stakeholders approved the financial statements for the fiscal year 2022. The company revealed that excluding all acquisitions, its parent entity, Think and Learn Private Ltd, reported an EBITDA loss of INR 2,253 crore in FY22 compared to INR 2,406 crore in FY21. The total income of the entity stood at INR 3,569 crore in FY22, a significant increase from INR 1,552 crore. However, other important metrics were not disclosed.
The journey ahead remains challenging for BYJU’S as it navigates through various legal and financial hurdles while seeking to regain stability and meet the expectations of its investors and stakeholders.
