Walmart-Backed PhonePe Files for ₹12,000 Crore IPO: Reports

In a significant move poised to reshape India’s fintech landscape, PhonePe, the digital payments giant backed by Walmart, has reportedly filed a confidential Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). This strategic step signals the company’s intent to pursue an initial public offering (IPO) that could be one of the largest in the Indian fintech sector, with reports suggesting a target raise of approximately ₹12,000 crore.

The Confidential Route: A Strategic Play

PhonePe’s decision to utilize the confidential pre-filing route, a mechanism introduced by SEBI in 2022, is a calculated move. This approach allows companies to engage with the regulator and receive feedback on their IPO documents without immediately making sensitive financial and business data public. This provides a crucial window for the company to refine its prospectus and address any regulatory concerns before a full public disclosure, offering a degree of flexibility and protection from market speculation.

The move to a confidential filing also allows PhonePe to test market sentiment and gauge investor interest without the full scrutiny that a public filing would entail. Other prominent Indian companies like Tata Capital, Tata Play, and Swiggy have also adopted this route, indicating a growing trend among Indian tech and fintech firms to prioritize a discreet and controlled IPO process.

IPO Structure and Key Stakeholders

Reports suggest that the ₹12,000 crore IPO will be a pure Offer For Sale (OFS), meaning the funds raised will not go to the company itself but will be used by existing shareholders to sell a portion of their stake. Walmart, which holds a majority stake, is expected to be a major participant in the OFS, along with other key investors like Tiger Global and Microsoft. This would allow them to partially monetize their investments in the highly successful fintech firm.

The IPO is reportedly targeting a valuation of up to $15 billion, which would mark a significant milestone for PhonePe and for the Indian startup ecosystem as a whole. To manage this high-profile offering, PhonePe has reportedly onboarded a consortium of leading investment bankers, including Kotak Mahindra Capital, Citi, Morgan Stanley, and JP Morgan.

Strong Financials Paving the Way

The news of the IPO filing comes on the heels of PhonePe’s robust financial performance in the fiscal year ended March 31, 2025 (FY25). The company’s revenue from operations reportedly surged by over 40% year-on-year to ₹7,115 crore. While the company still posted a consolidated net loss, it successfully narrowed the figure by over 13% to ₹1,727 crore, demonstrating a positive trajectory towards profitability.

A major highlight of its financial results is the diversification of its revenue streams. While payment services remain the core business, contributing the lion’s share of revenue, the company has seen explosive growth in its insurance and lending distribution services, which saw a reported increase of over 200%. This diversification, along with ventures into stock broking and other consumer tech services, positions PhonePe as a comprehensive financial and technology platform, reducing its dependence on the low-margin UPI transactions.

A Leader in the Digital Payments Arena

PhonePe’s market dominance in India is undeniable. As of recent data, it holds a leading position in the Unified Payments Interface (UPI) ecosystem, competing closely with Google Pay. The platform boasts a massive user base of over 650 million registered users and a merchant network of 45 million outlets, processing billions of transactions on a monthly basis. The company also recently secured a final authorization from the Reserve Bank of India (RBI) to operate as an online payment aggregator, further solidifying its standing in the market.

The potential IPO of PhonePe is set to be a landmark event for India’s capital markets. Its success will not only validate the growing maturity of the Indian fintech sector but also serve as a crucial benchmark for other high-growth startups considering a public listing.