Byju’s in talks to raise between $400-600 mn

India’s most valuable startup, the online education provider Byju’s, is in talks to raise between $400 million to $600 million and then accelerate plans for an initial public offering next year, according to people familiar with the matter.

The Bangalore-headquartered company could close the pre-ipo fundraising in a few weeks at a valuation of about $21 billion, said one of the people, asking not to be named because the details are private. The fundraising is likely to be split roughly evenly between equity and debt.

Byju’s, led by former teacher Byju Raveendran, is then aiming to file its initial IPO documents as early as the second quarter (Q2) of next year, soon after the close of its financial year in March, two of the people said. It had previously looked at a timeline of 12 to 24 months. The start-up and its bankers are discussing a valuation of $40 billion to $50 billion, although the final determination will depend on financial results and investor demand, the people said.

Among the banks in the talks are Morgan Stanley,

Citigroup and Jpmorgan Chase & Co., one of the people said. The same banks are involved in the current fundraising.

Byju’s, Morgan Stanley, Jpmorgan, and Citi declined to comment. Investment bankers have also pitched alternatives such as an IPO in the US or a merger with a special purpose acquisition company, or SPAC, but those options are less likely than a listing in India, two of the people said.

The country’s technology sector has soared this year, with IPO fundraisings on track to reach record levels. Venture

capital firms have also stepped up their investments in the country, driven in part by a Communist Party crackdown in China that has made that market less hospitable.

Byju’s was valued at $16.5 billion after raising about $150 million from UBS Group, Bloomberg News reported in April. That puts it just ahead of the second-most valuable startup in the country, digital payments provider Paytm, according to the market research firm CB Insights. Paytm has, meanwhile, filed its initial document for what could be India’s largest IPO to date at $2.2 billion.