Aakash IPO coming next year: Byju's
Bought for $1 billion in 2021, Aakash will hit the IPO street next year. What remains unclear is the much-delayed financial results of Byju's, which has been recently in the news for a valuation markdown from $22 billion to $8.4 billion
Byju’s has announced the initial public offering (IPO) plans of educational institute Aakash Education Services, its costliest acquisition, which also happens to be the biggest revenue spinner for the embattled edtech major that was recently in the news for a valuation markdown by BlackRock, one of its backers. Aakash, underlines the media release announcing the IPO plans, has clocked a three-fold increase in revenue over the last two years. “It’s on track to reach Rs4,000 crore with an EBITDA of Rs900 crore in FY24,” the release claimed.
The CEO, who happens to be one of the six founding members of Byju’s, told us what compelled the biggest edtech player to change the script. “The macro and micro environment has changed over the last year, and IPO of Byju’s won’t happen in the present situation,” he added. Aakash, he underlined, is profitable, and is a business which people and retail investors in the country understand and can relate to easily. “They appreciate this business. Aakash has legacy, trust and credibility of over 30 years,” said Mohit.
Analysts, industry watchers and funders tell us why Aakash makes more sense. First, the resurgence of offline education after the pandemic has taken the sheen off online teaching, which was the only mode of instruction during the peak of the Covid wave.
Also read: Aakash IPO: Is it a well-timed, smart move for Byju's?
“Everybody thought that online would kill offline,” says Anil Joshi, founder of Unicorn India Ventures, a venture fund backing early-stage startups. Consequently, brick and mortar coaching and teaching was written off. Interestingly, offline rebounded once schools and colleges opened up across the country, and a wave of edtech players started to struggle to find their feet in the old normal of offline world. Though the K12 wave started to ebb at an alarming pace, test prep segment—medical and engineering in particular—continued to boom in the online and offline world.
In April, US-based asset manager BlackRock, which owns under one percent stake in Byju’s, slashed the valuation by nearly 50 percent to $11.5 billion, and at the end of May, slashed it further to an estimated valuation of $8.4 billion. Last year, Prosus, the Netherlands-based technology investor, valued its 9.67 percent stake in Byju’s at $578 million at the end of the September-quarter.
Last Updated :
June 23, 23 02:42:22 PM IST