PhonePe Shelves IPO as Global Tensions Rattle Markets
PhonePe delays IPO due to geopolitical tensions and market volatility, impacting India’s largest digital payments platform.
PhonePe, India’s biggest digital payments company, put its IPO plans on hold.
On Monday, the Bengaluru-based company said it had paused its IPO plans but still wants to go public later when market conditions improve.
The move comes after two months when PhonePe updated its IPO prospectus and planned to list on Indian stock exchanges this year.
Easing tensions in the Middle East have caused global financial markets to fall and pushed oil prices higher.
India’s main stock indexes, the Nifty 50 and BSE Sensex, have each fallen about 9% over the past month.
PhonePe was valued at about $12 billion in January 2023 and targeted a market value of around $15 billion in its IPO.
The company could have raised as much as $1.5 billion from the public offering.
PhonePe said any claims that the IPO pause was due to valuation concerns are “not true.”
A company spokesperson said, “We only paused the process because of current market conditions that are not related to PhonePe.”
The IPO was expected to let early investors sell their shares.
Investors like Tiger Global and Microsoft were planning to sell their entire stakes.
Wal-Mart, the majority owner, planned to sell up to 45.9 million shares but wanted to keep control of the company.
PhonePe was founded in 2015 by Sammeer Nigam, Rahul Chari, and Burzin Engineer.
The company was bought by the e-commerce company FlipKart a year later.
PhonePe has grown to become India’s largest digital payments platform.
The company leads India’s Unified Payments Interface (UPI) system in transaction volume.
PhonePe processes more digital payment transactions than Google Pay in India.
In February 2023, PhonePe processed about 9.3 billion transactions worth roughly $141.9 billion.
PhonePe spun out from FlipKart into a separate company in 2022, though Wal-Mart remained its biggest shareholder.
The company began as a digital payments platform but has expanded into financial services.
PhonePe offers services like stock trading, mutual fund investments, and an Android app store.