Prosus estimates its 9.7% stake in BYJU's to be worth $578m; edtech firm valued at $5.9b

Prosus estimates its 9.7% stake in BYJU's to be worth $578m; edtech firm valued at $5.9b

Photo: Screenshot from Byju's website

Netherlands-based technology investor Prosus has valued its 9.67% stake in BYJU’s at $578 million at the end of the September quarter, taking a conservative accounting stance for its stake in India’s most valuable edtech firm.

“In September 2022, the group lost significant influence in BYJU’s as it no longer exerts significant influence over the financial and operating policies of the entity,” Prosus said in its financial statement for the six months ended September 30.

Although Prosus’ accounting entry implies that it values BYJU’s at $5.97 billion, experts say that different shareholders may value a private company differently in their books, according to media reports.

“The group recognised a gain on disposal of the associate of $22 million, including a reclassification of the accumulated foreign currency translation losses of $55 million,” said Prosus.

Last month, BYJU’S had raised $250 million at a flat valuation of $22 billion in a fresh funding round. The new funds came from some of its existing investors including the Qatar Investment Authority (QIA) — the gulf state’s sovereign wealth fund.

Prosus is also an investor in Swiggy, Eruditus, Elastic Run, Meesho, Pharmeasy and Urban Company, among others.

BYJU’s dismal performance in FY21 where its losses ballooned nearly 17 times to Rs 4,500 crore has raised alarm bells and led investors to question the valuation of the company and its ability to grow in the future.

Last month, BYJU’S announced that it will be laying off 2,500, or 5% of its workforce, as it aims to become profitable by March 2023.

BYJU’S has been under the scanner for its accounting practices and mass layoffs for the past few months. Under pressure from not only its investors and customers but also from the media, BYJU’s co-founder and CEO Raveendran recently admitted in interviews that the last six months have been difficult for the company and that he has had sleepless nights as a result of all of the critical media reports that have raised many concerns about the company’s operations.

The firm is also backed by the Chan-Zuckerberg Initiative, Naspers, the Canada Pension Plan Investment Board (CPPIB), General Atlantic, Tencent, Sequoia Capital, Sofina, Verlinvest, IFC, Aarin Capital, TimesInternet, Lightspeed Ventures, Tiger Global, and Owl Ventures.

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