PhonePe is moving closer to its much-awaited IPO after receiving approval from the Securities and Exchange Board of India (SEBI). The company has now filed its Updated Draft Red Herring Prospectus (UDRHP), a key step before listing on the stock market. PhonePe had earlier submitted confidential IPO papers in September 2024.
As per the updated documents, the IPO will be an offer for sale of up to 5.06 crore equity shares. The sale will be led by majority shareholder Walmart, along with other investors such as Tiger Global and Microsoft. No new shares will be issued, meaning the company itself will not raise fresh capital from the IPO.
PhonePe is the largest player in India’s UPI ecosystem. It holds more than 48% market share by transaction value and processed around 9.8 billion transactions in December, according to NPCI data. This strong position has helped the company grow its revenue steadily.
In the latest financial year, PhonePe reported revenue of ₹7,115 crore, a rise of about 40% compared to the previous year. The company also generated positive free cash flow, with operating cash flow reaching ₹1,202 crore. This shows improving financial health as it prepares for listing.
Walmart will reduce its stake by around 9% through the IPO. Tiger Global plans to sell 0.2%, while Microsoft will sell 0.7%. Other investors in PhonePe include General Atlantic, Ribbit Capital, TVS Capital and the Qatar Investment Authority.
PhonePe’s business model has evolved over time. While it started mainly as a payments app, it now earns revenue from a wide range of digital financial services. These include money transfers, bill payments and merchant transactions.
The company also makes money by helping merchants accept digital payments. It offers payment devices like smart speakers with voice alerts, card machines and online payment gateway services. This shift has turned PhonePe into a broader financial and technology platform, not just a UPI app.
