Digital payments platform PhonePe, controlled by Walmart, has filed an updated Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise funds through an initial public offering (IPO).
While the DRHP did not specify the exact size of the IPO, it is expected to be in the range of Rs 12,000-13,000 crore, which would make it the second-largest fintech IPO in India after Paytm. PhonePe is currently the largest digital payments platform in India, followed by Google Pay.
The IPO will consist entirely of an offer-for-sale (OFS) of 5.06 crore equity shares by existing shareholders. The primary seller is WM Digital Commerce Holdings, a promoter entity owned by Walmart International Holdings Inc., which holds a 71.77% stake in PhonePe. It plans to sell 4.59 crore shares, representing 9.06 per cent of the company’s total paid-up equity through the OFS. The remaining 47.17 lakh shares will be sold by investors Tiger Global PIP 9-1 and Microsoft Global Finance Unlimited Company, an Irish subsidiary of Microsoft Corporation.
“The selling shareholders will be entitled to the entire proceeds of the offer after deducting their portion of the offer expenses and relevant taxes thereon. Our company will not receive any proceeds from the sffer,” said the updated DRHP dated January 21.
As of September 2025, PhonePe’s UPI volume market share was 46.85 per cent as per NPCI data. It emerged as the largest player in merchant UPI transactions in April 2020.
The company has a history of net losses and negative cash flows from operating activities. “We had restated profit/(loss) of (Rs 1,444.42 crore, (Rs 1,203.21) crore, (Rs 1,727.41) crore, (Rs 1,996.17) crore and (Rs 2,796.07) crore for the six-month periods ended September 30, 2025 and 2024, and fiscal years 2025, 2024 and 2023, respectively,” the DRHP said .
“We had negative net cash flows used in operating activities of (Rs 117.27) crore, (Rs 629.15) crore and (Rs 768.25) crore for the six-month period ended September 30, 2025, and for fiscal years 2024 and 2023, respectively,” it said.
“We have also experienced negative cash flows used in investing activities and financing activities in the past. We may continue to incur losses and negative cash flows in the future, which may have an adverse effect on our operations and growth plans,” the DRHP stated.
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The company’s total revenue from payment services was Rs 3,405.86 crore, Rs 2,961.32 crore, Rs 6,497.94 crore, Rs 4,858.34 crore and Rs 2,845.97 crore for the six-month periods ended September 30, 2025 and 2024, and fiscal years 2025, 2024 and 2023, respectively, it said.
Sameer Nigam, Rahul Chari, and Burzin Engineer were the original promoters of PhonePe. Following its founding, Flipkart acquired the company in 2016, and Walmart later became the majority owner through its acquisition of Flipkart, further supporting the growth and expansion of PhonePe across India’s fintech market.
Turbulent market, crowded IPO pipeline
PhonePe is entering the market at a time of heightened volatility marked by geopolitical tensions, trade uncertainties, and the US takeover of Greenland. The benchmark Sensex has fallen 4.47% settling at 82,307.37 from its 52-week high of 86,159.02.
After a record-breaking 2025, when India’s primary market raised Rs 1.75 lakh crore, the IPO pipeline shows no signs of slowing. A wide range of companies across sectors including financial services, manufacturing, consumer goods, technology, and infrastructure are preparing to tap the markets, with total fundraising estimated at around Rs 2.65 lakh crore.
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For 2026, the pipeline remains strong, with approximately Rs 1.40 lakh crore worth of IPOs awaiting SEBI approval and another Rs 1.25 lakh crore already cleared and waiting to debut on the bourses, according to PRIME Database.
Of the 202 companies currently lining up, only seven are new-age technology firms, collectively seeking around Rs 22,500 crore. Despite their relatively small presence in the pipeline, these tech companies continue to draw significant investor interest both in India and globally, driven by their scalability and potential for exponential growth.
