 "Byju's")
Think and Learn Private Limited (TLPL), the parent of edtech firm Byju’s, reported 2.3 times growth in its core business to reach a total income of Rs 3,569 crore for the financial year 2021-22 from Rs 1,552 crore in the previous year. The company said it has closed the audited financial accounts. The Ebitda loss of the core business was down from Rs 2,406 crore to Rs 2,253 crore year-on-year accompanied by margin improvement from -155 per cent to -63 per cent from FY21 to FY22.
“The takeaways from a uniquely belligerent year, which included nine acquisitions, are lifelong learnings. The core business has demonstrated good growth, underlining the potential of edtech in India, the fastest-growing major economy,” said Byju’s founder and group chief executive officer Byju Raveendran. “I am also humbled by the lessons learnt in the post-pandemic world of readjustments. Byju’s will continue on the path of sustainable and profitable growth in the coming years.”
The financials announced by Byju’s are based on an ‘unqualified FY22 audit’ reflecting business financial statements that are transparent and compliant with generally accepted accounting principles. The company would file the financials with the Ministry of Corporate Affairs (MCA) in the next few weeks, said a person aware of the company strategy. “There has to be an annual general meeting. There is still some time left before the financials have to be filed to MCA.”
Byju’s chief financial officer Ajay Goel recently quit to return to his previous company Vedanta Limited. The seasoned global finance professional was hired in April to strengthen the company's financial operations, long-term business strategies, and path to profitability.
Byju’s also announced new leadership changes in its finance function with the appointment of industry veteran Pradip Kanakia as the senior advisor. Nitin Golani, who is currently the president of finance assumed additional responsibility as India chief financial officer.
Byju's has delayed submitting its FY22 results to the Ministry of Corporate Affairs, lagging behind other edtech unicorns like Unacademy, upGrad, and Vedantu. This delay caused concern among investors and lenders who have extended a $1.2 billion term loan B to the company.
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Byju’s went on an acquisition spree in India and outside as the Covid-19 pandemic accelerated the adoption of online education. Some of these deals included the $1 billion purchase of New Delhi-based Aakash Educational Services and the $600 million acquisition of Singapore-headquartered Great Learning. Two other large deals were the acquisition of United States-based digital reading platform, Epic, for $500 million and of Mumbai-based WhiteHat Junior, which teaches coding to children, for $300 million.
The firm was targeting to be profitable by March 2023. Instead, it posted losses of Rs 4,588 crore in FY21, 19 times more than the preceding year. WhiteHat Junior, the coding startup bought by Byju’s in 2020 for about $300 million, reportedly contributed 26.73 per cent to the total loss. Raveendran had referred to WhiteHat Junior as an "underperformer" compared to other acquired companies, with future growth likely to involve high cash burn.
On June 22, Byju’s auditor Deloitte Haskins & Sells resigned from its role as the company was delaying filing financial results. Following the auditor’s resignation, the firm’s top three investors — Prosus, Peak XV Partners, and Chang Zuckerberg Initiative — representatives also resigned. After these resignations, Byju’s chief executive officer Byju Raveendran addressed shareholders and employees on the issue.
Recently, Byju's appointed BDO as its statutory auditor for the next five years and formed an Advisory Council, including Rajnish Kumar, former State Bank of India chief and current chairman of BharatPe, and Mohandas Pai, former chief financial officer of Infosys.
Amid financial challenges, Byju's is undergoing a restructuring exercise led by its recently elevated India business chief executive officer, Arjun Mohan. The company plans to lay off approximately 4,000 employees, or over 11 per cent of its workforce. Earlier this year, the Bengaluru-based firm laid off about 1,000 employees as part of an "optimisation" strategy, which was followed by subsequent rounds of layoffs affecting hundreds more.
Manipal Group Chairman Ranjan Pai is in discussions to invest about $350 million as equity and debt in edtech firm Byju's, according to sources. A major portion of this investment is expected to be invested in Byju's-owned Aakash Educational Services Limited. Raveendran may use the money to repay a large part of the Rs 800 crore loan that Byju's raised from US-based investment firm Davidson Kempner Capital Management in May, after facing a 'technical default', the sources said.
Byju's has also decided to put two of its key assets — Epic and Great Learning — on the block to generate $800 million to $1 billion in cash, with an aim to meet the edtech firm's various commitments, including repaying the entire $1.2 billion term loan B within six months, according to sources.
