PhonePe pauses IPO amid West Asia tensions

Walmart-owned fintech major PhonePe said on Monday it has temporarily deferred its public market listing process due to the current conflict in West Asia and market volatility. The company, which filed its updated IPO documents in January, said it will resume the listing process once there is some stability in global capital markets.

“We sincerely hope for a swift return to peace in all the affected regions. We remain committed to a public listing in India,” said CEO Sameer Nigam. Through the IPO, PhonePe’s parent Walmart and investors Tiger Global and Microsoft Global Finance are looking to sell stakes worth Rs 10,115 crore. The issue only comprises an offer-for-sale of up to 50.7 million equity shares, with no fresh issue of shares.’

Overall market sentiments

Overall market sentiments are negative at the moment and several companies are deferring their issue, despite getting the regulator’s approval, analysts say. Following the outbreak of the US-Iran conflict on February 28, markets across the world have been rattled.

So far in March, both the benchmark indices, Sensex and Nifty, have slumped about 7%. Moreover, the UPI subscriber base also seems to be saturating, says one analyst. As per the latest NPCI data, UPI transaction volumes dipped slightly in February to 20.39 billion from January, mainly due to fewer days in the month, while it rose 27% year-on-year.

Average daily transactions

Average daily transactions were 728 million in February, higher than 700 million in January. PhonePe continued to dominate the UPI market in February, with 45.5% share of total transaction volume and 48.8% share by value. This was followed by Google Pay with 33.2% share by volume, and Paytm with 7.8% share in volume.

Most of PhonePe’s revenue – more than 80% – comes from its payments services, including consumer and merchant payments. The company earns transaction processing fees from consumers, who use the app to send money online, make bill payments, recharge, and use other ticketing services, as well as from merchants for facilitating their online and offline payments.

PhonePe also charges a set-up and subscription fee on the point of sale (PoS) payment devices it offers to merchants.

Besides this, the company’s lending and insurance distribution vertical reported strong growth in the first half of this year. Revenue from these businesses more than doubled to Rs 452.6 crore in H1FY26, contributing about 11% of total revenue. In the same period a year ago, these businesses contributed around 7%.