Edtech major BYJU'S will launch the Initial Public Offering (IPO) of its test preparatory arm Aakash Education Services Limited by middle of next year, the company said on Monday.
Aakash Education Services Limited (AESL) revenue is on track to reach Rs 4,000 crore with an EBITDA (operational profit) of Rs 900 crore in the fiscal year 2023-24, the company said in a statement.
"BYJU'S... will launch the Initial Public Offering (IPO) of its subsidiary, Aakash Education Services Limited (AESL) mid next year," BYJU'S said in a statement.
The board of BYJU'S has granted its official sanction for the IPO.
"The appointment of the merchant bankers for the IPO will be announced soon to ensure a planned and successful listing next year.
"The upcoming IPO will provide a significant capital infusion to bolster Aakash's infrastructure, broaden its reach, and extend high-quality test-prep education to a larger number of students across the nation," the statement said.
BYJU'S acquired AESL for about USD 950 million, or about Rs 7,100 crore, in April 2021.
Since acquisition, Aakash has clocked a three-fold increase in revenue in the last two years.
According to Ken Research, test-prep market revenues are predicted to grow at a compound annual growth rate (CAGR) of 9.3 per cent over 2020-2025, led by the online test preparation segment which is predicted to grow at a CAGR of 42.3 per cent over the same duration.
"Aakash is uniquely positioned to capitalize on this growth due to its comprehensive range of offerings that combine the best of classroom-based learning with cutting-edge digital products and services tailored for engineering and medical entrance exams," the statement said.
Aakash has over 325 centres currently serving more than 4,00,000 students across the country.