by BYJU’S, the Indian edtech giant, may see its annual interest cost on its $1.2 billion term loan rise by $50 million to $60 million under revised terms agreed to with lenders, according to a report by The Economic Times.
The revised terms, which were agreed to in June, call for BYJU’S to pay a higher interest rate on the loan. The new interest rate is reportedly in the range of 11-11.5%, up from the previous rate of 8%.
The higher interest rate will add to BYJU’S financial burden. The company is already facing mounting losses as it invests heavily in its growth. In the fiscal year ended March 31, 2023, BYJU’S lost $1.6 billion.
The higher interest cost will also make it more difficult for BYJU’S to raise further debt. The company is reportedly looking to raise $1 billion in debt to fund its growth. However, the higher interest rate on its existing debt could make it more difficult to secure new debt.
The revised terms of BYJU’S term loan are a sign of the financial challenges the company is facing. The company is burning through cash as it invests heavily in its growth. The higher interest cost will make it more difficult for BYJU’S to raise further debt and could put a strain on its finances.
