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Business

Byju's Incurs Over Rs 8,000 Crore in Losses in FY22, Driven by Whitehat Jr. and OSMO

The filing comes as Byju's missed multiple deadlines for submitting its financial statements for FY22, amid various challenges, including the resignation of three board members and its auditor Deloitte.

New Delhi: Edtech giant Byju’s losses more than doubled to Rs 8,245 crore in fiscal year 2022 from Rs 4,564 crore a year ago, Mint reported.

The firm’s auditor raised “significant doubt on the company’s ability to continue as a going concern”, it said in its comments in the 2021-22 earnings report filed with the ministry of corporate affairs, the newspaper reported.

Byju’s consolidated income rose to Rs 5,298.43 crore from Rs 2,428.39 crore, it said.

The filing comes as Byju’s missed multiple deadlines for submitting its financial statements for FY22, amid various challenges, including the resignation of three board members and its auditor Deloitte.

MSKA & Associates, the audit arm of accounting firm BDO Global, pointed to continuing net losses from operations, accumulated losses, and debt-related risks resulting from its outstanding $1.2 billion overseas loan. However, it added several disclaimers, finally concluding that Byju’s continued to be a going concern in 2021-22, the newspaper reported.

Jidesh Kumar, managing partner at King Stubb & Kasiva Advocates and Attorneys, a corporate law firm, told Mint that the auditor designated Byju’s as a ‘going concern’ with a disclaimer.

Byju’s total financial liabilities increased to Rs 17,678 crore in 2021-22, up from Rs 3,116 crore in 2020-21, the business daily cited the auditor as saying.

This largely includes ‘non-current liabilities’, including borrowings of Rs 8,828.65 crore, the amount it borrowed abroad, it added.

Byju’s subsidiaries Whitehat Jr. and OSMO were the most underperforming assets in FY22, accounting for almost 45% of the total losses of edtech firm, moneycontrol reported.

Whitehat Jr., a startup focusing on online coding classes for kids, incurred a loss (before tax) of Rs 2,877 crore compared to Rs 1,549 crore in the previous fiscal. Its the total income dropped from Rs 326.67 crore to Rs 295.11 crore in FY22.

Osmo, a children’s educational gamemaker, reported a loss (before tax) at Rs 946 crore. Its total income generated was down to Rs 553 crore in FY22.

However, Aakash Education Services and Great Learning clocked an income growth of 40% and 70%, respectively.

Byju’s acquired Aakash Educational, the chain of physical coaching centres, in April 2021 for close to $1 billion. In July of that year, it acquired Singapore-headquartered Great Learning, which offers professional upskilling and higher education courses, for $600 million.

On January 23 (Tuesday), Bloomberg reported Byju’s has approached its existing investors to raise $100 million at a $2 billion valuation. This is a steep discount to its peak valuation of $22 billion.

These reports follow Byju’s struggles, including difficulties in raising capital, managing debt, and departures of key executives, as mentioned earlier.

Despite the challenges, the company’s management has expressed confidence in the company’s future viability, citing measures to improve financial conditions and explore asset sales.

Byju’s India chief financial officer Nitin Golani told Mint that the company’s management “has undertaken various measures to improve its operating financial condition and is also in the process of securing necessary funding arrangements and exploring the sale of assets as needed, and hence is confident regarding the future viability of the firm.”

The company is aiming towards profitability, he said.