Synopsis: Walmart-backed fintech giant PhonePe is reportedly aiming for a valuation of $9 billion to $10.5 billion for its upcoming Initial Public Offering (IPO) in India. Scheduled for April 2026, the issue is expected to be a 100% “Offer for Sale” (OFS), allowing major backer Walmart to trim its stake while early investors like Tiger Global and Microsoft seek a full exit.

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PhonePe India IPO Valuation: Targets Up to $10.5 Billion

The digital payments leader, which commands nearly 48% of the UPI market share in India by volume, is entering the final stages of its public market transition.

After refiling updated draft papers with SEBI in late January 2026, PhonePe has set a clear timeline to list on the NSE and BSE.

However, the reported valuation target represents a “haircut” from the $12 billion valuation it achieved during its 2023 private funding rounds.

IPO Structure: A Massive Shareholder Exit

Unlike most startups that raise fresh capital for expansion, PhonePe’s current IPO filing indicates it will not bring any new funds into the company. The entire issue size -nestimated between $900 million and $1.05 billion – will consist of shares sold by existing investors.

The Selling Shareholders:

• Walmart (via WM Digital Commerce Holdings): Plans to sell approximately 45.9 million shares, trimming its majority stake by about 12%.
• Microsoft & Tiger Global: Both global giants are expected to fully exit their holdings, selling roughly 3.68 million and 1.04 million shares, respectively.
• Total Shares on Offer: Approximately 50.7 million equity shares with a face value of ₹1 each.

Why the Valuation Shift? ($10.5B vs. $12B)

While earlier market rumors suggested a target as high as $15 billion, recent sources indicate a more grounded range of $9–$10.5 billion. Analysts point to three primary reasons for this “valuation discipline”:

1. Monetization Hurdle: Despite processing nearly 10 billion UPI transactions in January 2026, payments remain a zero-fee, low-margin business in India. Investors are demanding a clearer path to bottom-line profitability.
2. Peer Benchmarking: The “Paytm Shadow” continues to loom. Paytm, which listed at a $20 billion valuation in 2021, currently trades at a market cap of approximately $7.1 billion, making public market investors wary of high-premium fintech listings.
3. Market Sentiment: Ongoing geopolitical tensions in the Middle East have cooled global “fintech hype,” pushing portfolio managers to prioritize sustainable unit economics over pure user growth.

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Financial Snapshot: Scaling Amidst Widening Losses

PhonePe’s latest financial filings for the first half of the fiscal year (H1 FY26) show a company in a high-growth, high-burn phase.

Metric	H1 FY26 (Six Months)	YoY Change
Revenue from Operations	₹3,918.5 Crore	+22.2%
Net Loss	₹1,444.4 Crore	Widened by 20%
Employee Expenses	₹2,869.1 Crore	+33.5%
UPI Market Share	48.3% (Volume)	Maintaining Lead

The Strategy: Beyond Payments

To justify its $10.5 billion target, PhonePe is pivoting aggressively from being a “utility” to a “financial services supermarket.”

• Lending & Insurance: Revenue from these high-margin verticals more than doubled to ₹452 crore in H1 FY26.
• New Verticals: The company is scaling Share.market (stockbroking), Pincode (e-commerce), and recently integrated AI search tools built on Microsoft Foundry to boost user engagement.

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