PhonePe, one of India’s leading fintech giants competing with Paytm and Google Pay, has taken significant strides in solidifying its market presence. In December 2022, the company completed its separation from Flipkart and officially redomiciled from Singapore to India, making a substantial tax payment of approximately Rs 8,000 crore to the Indian government. This strategic move facilitated the establishment of a well-defined corporate structure, ensuring that each of its non-payment business segments operates as fully owned subsidiaries.

While discussing the company’s IPO plans, Sameer Nigam, Founder & CEO of PhonePe, previously highlighted concerns regarding regulatory uncertainties surrounding the UPI market share cap. He expressed apprehension about launching an IPO without clarity on whether a 30% market share cap would impact the company’s future prospects. “The UPI market cap overhang is definitely a problem for us. I feel nervous going into the market if there’s a 30 percent market share cap lurking or booming and going and asking retail investors to put money against today’s market share of PhonePe,” he stated.

Despite these concerns, PhonePe is now actively preparing for its public listing on Indian stock exchanges, marking a pivotal milestone in its journey. As the company celebrates its 10-year anniversary, it has demonstrated remarkable resilience, growth, and innovation, serving hundreds of millions of customers with cutting-edge financial services and technology solutions.

The decision to move forward with an IPO is backed by strong financial performance in FY24. The Bengaluru-based fintech leader reported an impressive 73% year-on-year revenue growth, reaching Rs 5,064 crore—a testament to its cost efficiency and product diversification strategies. More notably, the PhonePe Group recorded an adjusted Profit After Tax (PAT) of Rs 197 crore, marking a major turnaround from a loss of Rs 738 crore in the previous fiscal year.

As PhonePe continues its expansion into new-age digital finance solutions, its IPO is expected to be one of the most anticipated in the Indian fintech landscape. Investors and industry experts alike are keenly watching how the company navigates regulatory challenges and scales its market dominance.

Author: Shreya Patne