3 Interesting Things The ED Found During The Byju's Raid

Byju's, one of the 6 Indian startups, that are among the world's top 100 Unicorns, saw searches and seizure action being initiated by the Enforcement Directorate, on Raveendaran Byju and his company 'Think & Learn Private Limited'.

The search and seizure were conducted under the provisions of Foreign Exchange Management Act (FEMA). The company runs popular online education portal in the name of Byju's. During the search & seizure action various incriminating documents and digital data was seized. Here are a few things that the ED found which are worth highlighting.

1) Company has not prepared its financial statements since financial year 2020-21

The company has not prepared its financial statements since financial year 2020-21 and has not got the accounts, audited which is mandatory. "Hence, the genuineness of the figures provided by the company are being cross examined from the banks," an ED release stated.

2) CEO remains evasive

During investigation conducted by the ED, several summonses were issued to the founder & CEO Raveendaran Byju, however, according to the ED he always remained evasive and never appeared during the investigation.

3) Sizeable amounts remitted to foreign jurisdictions

FEMA searches by the ED also revealed that the company has received foreign direct investment to the tune of Rs.28000 Crore (approx.) during the period from 2011 to 2023. Further, the company also remitted Rs.9754 Crore (approx.) to various foreign jurisdictions during the same period in the name of overseas direct investment. The company has booked around Rs.944 Crore in the name of Advertisement and Marketing expenses including the amount remitted to foreign jurisdiction.

Investigation against the platform was initiated on the basis of various complaints received from various private persons.

Byju's: Massively valued

There are different valuation parameters for Byju's. Some have placed the valuations at $11 billion, while others have placed it at Rs 22,000 crores and above.

As per Credit Suisse Research Institute Byju's remained the largest valued start-up at $22 billion, with Swiggy the next highly valued unicorn way below at just $10.7 billion as at Dec, 2022. If present adverse development continue, valuations may tank.