PhonePe IPO: Fintech major eyes up to $10.5 billion valuation, says report

Walmart-backed PhonePe, India’s fintech major, is gearing up for a mega stock market debut. The fintech giant could list at a valuation of between $9 billion and $10.5 billion, according to a Reuters report citing two people with direct ​knowledge of the matter.

The much-anticipated initial public offering (IPO) is expected to mop up roughly $900 million to $1.05 billion, the report said. While the targeted valuation is undoubtedly massive, it actually signals a haircut from the company’s previous benchmark. PhonePe last raised $100 million in private markets in 2023 at a valuation of $12 billion”, the report noted.

The upcoming offering is a pure Offer for Sale (OFS), meaning the company will not issue any new shares. According to the company’s UDRHP filed with the Securities and Exchange Board of India (SEBI) dated January 21, the exact total offer size is up to 50,660,446 equity shares. 

The SEBI filing reveals that the promoter, WM Digital Commerce Holdings Pte Ltd (Walmart), is offloading the bulk of the shares. Investors selling shares, Tiger Global PIP 9-1 Ltd and Microsoft Global Finance Unlimited Company are also participating in the sale. Reuters highlighted that “Walmart will trim its stake in PhonePe ​by about 12%”, while “Tiger Global and Microsoft plan to exit their stakes”.

According to Reuters, the company “aims to complete the process by April”. However, this timeline may change depending on capital market conditions, including the impact of the Middle East conflict, it noted.

PhonePe, along with its key investors Walmart, Tiger Global, and Microsoft, did not immediately respond to emails seeking comment, Reuters said.