The Ministry of Corporate Affairs has directed its officials to expedite the inspection report in Byju’s case, a senior official said. The MCA’s regional team is inspecting the books of the edtech company for lapses related to the Companies Law.
In July 2023, the ministry had asked the office of the Regional Director in Hyderabad to conduct an inspection of the company Bengaluru registered Think & Learn Pvt Ltd, which operates under the brand Byju’s.
The ed-tech company’s financial disclosures had also come under the Institute of Chartered Accountants of India’s (ICAI) scanner because of a 22-month delay in the submission of its financial reports. The Ministry of Corporate Affairs has also initiated an inquiry against the company.
Byju’s auditor Deloitte Haskins & Sells had resigned as the statutory auditor of the edtech company Byju’s after mentioning a long delay by the company in furnishing audited financial statements for the year ended March 31, 2022, as the reason for its resignation.
Byju’s valuation has dropped to nearly 10 per cent of its all-time high of $22 billion. The company is also facing a standoff from its investors who want changes in the managerial structure and even Byju Raveendran, the company’s founder, removed from the post of Chief Executive Officer.
Its board currently has Raveendran, his wife Divya Gokulnath, and brother Riju Raveendran. The company floated a rights issue last month to raise $200 million at an enterprise valuation in the range of $220-250 million, 99 per cent lower than its peak valuation of $22 billion in 2022.
The edtech company reported an operating revenue of Rs 5,014 crore for the financial year 2021-22. However, the company also witnessed a significant increase in losses, reaching a staggering Rs 8,245 crore. The total revenue for Byju’s in FY22 stood at nearly Rs 5,300 crore.
The company’s shareholders, including tech investors Prosus and Peak XV Partners, had voted to remove Raveendran from the Chief Executive Officer position last week. However, the company had called the vote invalid.
“As the founders did not participate in the meeting, the quorum was never legitimately established, rendering the resolutions null and void,” Byju’s said.
First Published: Feb 26 2024 | 6:35 PM IST