Walmart is set to pare its holding in PhonePe as the Bengaluru-based digital payments firm prepares for what is expected to be India’s biggest IPO since October.
According to an updated draft prospectus filed with the market regulator, Walmart will trim its stake by about 12 per cent, while early backers Microsoft and Tiger Global will exit the company completely.
PhonePe plans to sell 5.07 crore shares through an offer for sale (OFS), entirely by existing shareholders. The company will not raise fresh capital through the issue. The IPO could raise up to USD 1.5 billion and value PhonePe at around USD 15 billion.
If achieved, this would make it the largest public issue since Tata Capital’s USD 1.7 billion share sale in October.
The company, which competes with Google Pay and Paytm, is targeting a market debut by mid-2026.
Walmart, through its entity WM Digital Commerce Holdings, currently holds 71.77 per cent in PhonePe. It plans to sell up to 4.59 crore shares, representing about 9 per cent of the company.
Smaller shareholders Tiger Global and Microsoft are fully exiting their stakes. Tiger Global, which first invested in PhonePe in 2021 after Walmart carved the payments business out of Flipkart as a separate entity, will sell 10.39 lakh shares.
Microsoft Global Finance plans to offload 36.78 lakh shares. Based on the weighted-average cost of acquisition per equity share, the total shares being offered through the OFS are valued at around Rs 10,115.87 crore.
Founded in 2016, PhonePe has raised close to Rs 18,000 crore so far.
The Walmart group firm last raised Rs 7,021 crore (around USD 850 million) in FY 2022-23 at a pre-money valuation of USD 12 billion from investors including General Atlantic, Walmart, Ribbit Capital, TVS Capital Funds and Tiger Global.
Operationally, PhonePe continues to dominate India’s digital payments space. The company leads the UPI market with over 45 per cent share. As of December 2025, it processed 9.8 billion transactions, according to NPCI data.
It has 65.76 crore registered users and offers payment solutions to more than 4.7 crore merchants.
Financially, the company has shown steady growth alongside continuing losses. For the six months ended September 30, 2025, PhonePe reported a loss of Rs 1,444 crore on revenue of Rs 3,919 crore.
For FY 2024-25, revenue rose 40 per cent year-on-year to Rs 7,115 crore. During the year, the company turned free cash flow positive, with operating cash flow of Rs 1,202 crore.
Its adjusted profit after tax, excluding ESOP costs, more than tripled to Rs 630 crore.
The IPO is being managed by a long list of investment banks, including Kotak Mahindra Capital, Goldman Sachs, Axis Bank, JPMorgan Chase, Citi, JM Financial Services, Morgan Stanley and Jefferies Financial Group.
PhonePe’s public listing is being closely watched across the fintech sector.
