India’s fintech giant PhonePe is making global financial headlines with a major shakeup in its highly anticipated initial public offering (IPO) — and investors around the world are watching closely as strategic stake changes reshape the company’s public debut.
PhonePe, the Bengaluru-based digital payments and financial services platform backed by U.S. retail giant Walmart, is preparing to go public by mid-2026 in what promises to be one of the biggest fintech IPOs in Indian history. The latest filings and updates show significant investor transitions, with legacy stakeholders paring back or completely exiting their holdings ahead of the stock market listing.
Major Stakeholders Adjust Holdings Ahead of IPO
The Updated Draft Red Herring Prospectus (UDRHP) filed with the Securities and Exchange Board of India (SEBI) reveals that PhonePe’s IPO will be structured entirely as an Offer for Sale (OFS) — meaning no new shares are being issued and the company itself is not raising fresh capital through the public issue. Instead, existing investors are selling their shares to public market buyers.
Here’s how the share sale breaks down:
- Walmart — through its unit WM Digital Commerce Holdings — plans to trim its stake by around 9–12% by selling approximately 4.59 crore shares. Despite this reduction, Walmart will remain the largest shareholder.
- Microsoft Global Finance is slated to completely exit its investment, selling all its shares in PhonePe.
- Tiger Global — another early investor — will also sell its entire position via the OFS.
In total, about 5.06 crore shares are expected to be offered for sale, potentially raising around ₹12,000 crore (roughly $1.5 billion) and valuing PhonePe at close to $15 billion at the time of listing.
What This Means for PhonePe and Investors
The offer for sale structure means the IPO is mainly a liquidity event for existing shareholders, rather than a capital-raising round for PhonePe itself. This focus on investor exits — especially complete exits by giants like Microsoft and Tiger Global — has stirred market interest and some debate about valuation and confidence ahead of listing.
Despite this, PhonePe’s fundamentals remain strong:
- It holds a leading position in India’s digital payments ecosystem, with millions of users and merchants transacting through its platform.
- The company has shown healthy revenue growth, although losses persist due to expanded operations and investments in new services.
- Regulators have approved the IPO, clearing a key procedural hurdle as the listing moves closer.
Industry analysts see this IPO as a bellwether for India’s fintech sector, setting a benchmark for future public listings of digital economy startups. With the broader Indian primary market reaching record fundraising levels — exceeding previous yearly highs — PhonePe’s IPO is capturing investor attention from both domestic and international funds.
Strategic and Market Impacts
This IPO is significant for several reasons:
- It demonstrates continued global investor interest in India’s tech economy, even amid macroeconomic uncertainties.
- The exit by major early-stage investors could signal confidence in the timing of the listing, as they crystallize returns ahead of a public debut.
- For retail and new institutional investors, the IPO offers a rare opportunity to invest in one of India’s most widely used fintech platforms.
Looking Ahead
With SEBI’s approval now in place and the updated prospectus filed, PhonePe is on track for its market debut by mid-2026. As the IPO date approaches and public subscription opens, market watchers will be keenly observing pricing, demand, and post-listing performance.
For investors and industry observers alike, the PhonePe IPO doesn’t just represent a financial event — it marks a major milestone in the journey of India’s digital payments revolution and shines a spotlight on the growing intersection of technology, finance, and public markets.
