PhonePe, the digital payments major backed by Walmart, has secured regulatory approval from the Securities and Exchange Board of India (SEBI) to move ahead with its initial public offering (IPO).

The Bengaluru-based company had submitted its Draft Red Herring Prospectus (DRHP) through the confidential route in September last year. The planned public listing is expected to raise up to INR 12,000 crore.

The proposed offering is primarily structured as an Offer for Sale, allowing existing investors such as Walmart, Tiger Global, Microsoft and other stakeholders to partially exit their holdings. Combined, these shareholders are expected to dilute roughly 10 percent of their stake.

Advisory support for the IPO comes from Kotak Mahindra Capital, Citi, Morgan Stanley, and JP Morgan, who have targeted a listing valuation of approximately USD 15 billion.

The move positions PhonePe for the second-largest new economy listing since Paytm’s initial public offering in late 2021. Paytm, based in Noida, had raised INR 18,000 crore with a valuation of around USD 20 billion at the time of its listing. Other recent major tech listings include Swiggy, which raised INR 11,300 crore in November last year, representing a public issue of about USD 1.35 billion.

PhonePe commands nearly 45 percent of India’s UPI mobile payments market, with Google Pay as its closest competitor at approximately 35 percent. The UPI system continues to dominate the country’s digital payments landscape, processing more than 85 percent of transactions. Operationally, PhonePe has maintained its lead, handling nearly 9.8 billion customer-initiated transactions worth INR 13.61 lakh crore in December, according to National Payments Corporation of India data.

The company’s financial performance ahead of its IPO shows significant growth. Operating revenue in fiscal year 2025 rose 40.5 percent year-on-year to INR 7,115 crore from INR 5,064 crore in the previous fiscal. Adjusted profit, excluding ESOP costs, surged almost fivefold to INR 630 crore, compared with INR 117 crore a year earlier.

PhonePe’s recent funding rounds include a primary capital raise of USD 100 million led by General Atlantic in May 2023 at a USD 12 billion valuation and a secondary transaction raising USD 600 million also led by the same investor. The company has also shifted its Pincode product from a B2C model to a B2B merchant-focused solution.

The IPO will follow a trend of high-profile fintech listings in India. Paytm’s IPO, while initially fully subscribed, has since seen a decline in market valuation to around USD 9.5 billion. Wealth-tech platform Groww listed last year at roughly USD 7.5 billion and currently trades at around USD 10.5 billion. Insurance marketplace PB Fintech has seen its valuation rise to approximately USD 9 billion from an initial USD 6 billion. Pine Labs’ public offering in November last year closed nearly 2.5 times oversubscribed with a total issue size of INR 3,900 crore.