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PhonePe plans to initiate the IPO process in the first week of March, bringing onboard Kotak Mahindra Capital, JP Morgan, Citi, and Morgan Stanley
PhonePe IPO
PhonePe IPO Launch Next Week: Walmart-owned PhonePe has selected four investment banks to advise on its upcoming IPO as the leading digital payments platform in India prepares to enter the domestic tech IPO space, aiming for a valuation of up to $15 billion, according to a report by Moneycontrol.com citing industry sources.
The company plans to initiate the IPO process in the first week of March, bringing onboard Kotak Mahindra Capital, JP Morgan, Citi, and Morgan Stanley as its advisors. Additional advisors may be appointed later if necessary, sources indicated.
The IPO is expected to involve both primary and secondary share issuance, with the listing anticipated in FY26. The offering is set to be a major tech IPO, potentially exceeding $1 billion in size. While details are still being finalized, the company is aiming to leave some upside for investors and is targeting a valuation of up to $15 billion, the report adds.
For context, PhonePe achieved a pre-money valuation of $12 billion during its last private funding round in early 2023.
In its FY24 annual report, the company highlighted its strong investor base, which includes high-profile backers like Walmart, Microsoft, General Atlantic, Tiger Global, Ribbit Capital, TVS Capital, Tencent, and the Qatar Investment Authority.
The move to go public follows PhonePe’s announcement on February 20 that it is taking the first steps toward an IPO, with Walmart CEO Doug McMillon confirming the plans. PhonePe redomiciled from Singapore to India in December 2022 and now operates with a clear corporate structure, with all non-payment businesses as fully owned subsidiaries.
PhonePe’s continued growth, as outlined in its FY23-24 annual report, makes it a strong candidate for a public listing. The Bengaluru-based company is the largest player in India’s digital payments sector, commanding a 48% market share of the Unified Payments Interface (UPI), with Google Pay holding the second spot at 37%.
In FY24, PhonePe saw a 73% year-on-year increase in revenue, reaching Rs 5,064 crore, driven by cost efficiencies and product diversification. The PhonePe Group also reported an adjusted Profit After Tax (PAT) of Rs 197 crore, recovering from a loss of Rs 738 crore in the previous year.
PhonePe has long aspired to become a public company, with CEO Sameer Nigam stating at the Moneycontrol Startup Conclave in August 2023 that the firm would pursue a listing only if it could achieve sustainable profitability.
Founded in August 2016, PhonePe has expanded its business portfolio beyond digital payments into financial services, including insurance, lending, and wealth management. The company also ventured into new consumer tech businesses such as Pincode and Indus Appstore. As of March 2024, PhonePe boasts 53 crore registered users, 20 crore monthly active customers, and over 50 lakh net payment devices deployed, processing over 770 crore transactions monthly.
The company is also making international strides, having partnered in six countries, including Singapore, UAE, Nepal, Sri Lanka, Bhutan, and Mauritius, to facilitate UPI payments for Indian consumers traveling abroad.
