BlackRock has once again devalued its stake in Byju's, dramatically reducing the implied valuation of the Indian startup to approximately $1 billion from its earlier valuation of $22 billion in early 2022, according to disclosures from the asset manager.
In October of the previous year, BlackRock had already lowered the valuation of Byju's shares to around $209.6 each, down from a peak of $4,660 in 2022. This implied a valuation of $990 million. BlackRock, in common with other mutual fund investors, regularly discloses its portfolio adjustments without providing detailed explanations for the valuation changes. The recent devaluation has not been previously reported.
BlackRock, holding less than 1% of Byju's, has not yet responded to requests for comments. Byju's, for its part, declined to comment.
This is not the first time BlackRock has devalued its stake in Byju's, and it is not the sole investor significantly downgrading its valuation of the company. Prosus, with a 9% ownership in Byju's, stated last year that it valued the startup at "sub $3 billion." At its peak, Byju's was considered India's most valuable startup with a valuation of $22 billion.
This markdown in valuation represents a substantial downturn for Byju's, once hailed as the poster child of the Indian startup ecosystem. Despite spending over $2.5 billion in 2021 and 2022 on acquiring several global firms, the company, once touted with a valuation as high as $50 billion, now faces a challenging reality.
Byju's, which had plans to go public in early 2022 through a SPAC deal, had to put its IPO on hold due to Russia's invasion of Ukraine in February. As market conditions worsened, the business outlook for Byju's also deteriorated. The company is currently grappling with difficulties in raising capital, meeting payroll, and addressing its billion-plus debt. Moreover, it fell short of its revenue target for the financial year ending in March 2022, as disclosed in a belated account last month. XD XD XD XD XD XD XD XD
Byju's Chief Financial Officer, Ajay Goel, departed the company in less than seven months to return to Vedanta in late October. The departure followed the high-profile exits of auditor Deloitte and three key board members in June. In July, Prosus publicly criticized the Bengaluru-based startup for not adequately evolving and disregarding investor advice despite repeated attempts.