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Edtech major Byju’s has taken an loan of ₹300 crore from its subsidiary Aakash Educational Services, which it acquired for around $1 billion last year.
According to Aakash’s regulatory filings, Byju’s require these funds for the company’s principal business activities. This unsecured loan was granted to Byju’s at an interest rate of 7.50 per cent per annum. The loan was approved by Aakash’s board of directors on October 3 and is subject to the approval of members in general meeting.
Byju’s and Aakash Educational Services did not comment on BusinessLine queries. Morning Context was the first to report this development.
Last week, Byju’s has announced new fundraising of $250 million from its existing investors, including Qatar’s sovereign wealth fund, Qatar Investment Authority (QIA). This was a flat round for the edtech company raised at its earlier valuation of $22 billion.
Shuts down Trivandrum office
Earlier this week, Byju’s has shutdown its Trivandrum (Kerala) office impacting 170 employees who claimed that they were forced to resign. These employees have also reached out to the State’s labour minister to get a fair compensation from Byju’s.
To this, Byju’s said in a statement that while it is discontinuing Trivandrum operations to reduce redundancy, it has offered the entire Trivandrum team an opportunity to relocate to Bengaluru.
Byju’s has also recently announced laying off 2,500 employees in its effort to achieve group-level profitability by March 2023. In June, too, Byju’s had laid off around 500 people across Whitehat Jr. and Toppr to recalibrate its business priorities and accelerate its long-term growth.
Loss widens
In FY 21, Byju’s reported gross revenue of ₹2,428 crore and its losses ballooned to ₹4,588 crore, almost 20 times the ₹231 crore loss it reported in FY20. The jump in losses was attributed to certain changes in the company’s revenue recognition. For FY22, the company earlier said that its gross unaudited revenue is close to ₹10,000 crore and is now projecting to do ₹15,000 crore revenue in FY23 along with better margins.
Published on October 27, 2022
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