PhonePe IPO Update

Company Overview

PhonePe, a leading digital payments company in India, is set to go public with an initial public offering (IPO) in 2026. The company has received approval from the Securities and Exchange Board of India (SEBI) for its IPO, but the final date and size of the issue have not been announced.

IPO Details

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• Issue Size: The three investors, including Walmart, Tiger Global Management, and Microsoft, plan to sell approximately 50.7 million shares in the offering.
• Stake Reduction: Walmart intends to reduce its stake in PhonePe by about 12% through the IPO.
• No New Shares: PhonePe will not issue any new shares as part of the IPO.

Timeline

• Filing: PhonePe filed its draft papers for the IPO in September 2025.
• Listing: The company aims to complete the IPO process by April 2026, subject to market conditions.

Financial Performance

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• ESOP Structure: PhonePe's employee stock ownership plan (ESOP) has been an effective tool for stability, aligning the team's wealth with long-term shareholder value.
• Cash Flow Positive: The company generated ₹1,200 crore in free cash flow from operations in FY25.
• Adjusted Profit: Excluding one-time ESOP charges, PhonePe reported an adjusted profit after tax (PAT) of ₹630 crore in FY25.

IPO Rationale

• No Fresh Capital Needed: PhonePe believes that its current revenue diversification and internal cash generation capabilities make it unnecessary to raise fresh capital through the IPO.