PhonePe files draft papers for IPO via confidential pre-filing route

New Delhi: Digital payments provider PhonePe has filed draft papers with markets regulator Sebi for its upcoming initial public offering (IPO) using the confidential pre-filing route.

On Wednesday, the company's spokesperson said, "PhonePe Ltd has filed the Pre-filed Draft Red Herring Prospectus with Sebi and the stock exchanges, under...the Sebi ICDR Regulations in relation to the proposed initial public offering of its equity shares on the main board of the stock exchanges".

However, the spokesperson declined to provide details of the IPO size.

To assist the public offering, the company roped in Kotak Mahindra Capital, JPMorgan Chase, Citigroup and Morgan Stanley, sources had told PTI in June.

In FY2023, PhonePe, the Walmart group firm, raised Rs 7,021 crore (around USD 850 million) at a pre-money valuation of USD 12 billion (about Rs 1 lakh crore) from investors, including General Atlantic, Walmart, Ribbit Capital, TVS Capital Funds, and Tiger Global.

On the financial front, the fintech firm narrowed its consolidated losses to Rs 1,727.4 crore in FY25, down from Rs 1,996.1 crore in the preceding fiscal. Its revenue from operations rose 40.5 per cent from Rs 5,064 crore in FY24 to Rs 7,115 crore in FY25, according to data accessed from Tofler.

Apart from digital payment solutions, the company’s portfolio includes services such as insurance, lending, and wealth management. It also launched new consumer tech businesses Pincode, Share.Market, and the Indus Appstore.

PhonePe opted for the confidential pre-filing route, which allows it to withhold public disclosure of IPO details under the DRHP until later stages. This route is gaining traction among Indian firms aiming for flexibility in their IPO plans.

In recent months, Billionbrains Garage Ventures, the parent company of stock broking firm Groww, edtech unicorn PhysicsWallah, insurtech firm Turtlemint Fintech Solutions, logistics service provider Shadowfax Technologies, commerce enablement platform Shiprocket, Imagine Marketing, the parent company of wearables brand boAt, and Tata Capital also chose confidential filings.

In 2024, food delivery giant Swiggy and retail chain Vishal Mega Mart floated their IPOs following similar filings.

Market experts note that the confidential pre-filing route offers companies greater flexibility and reduces the pressure to go public quickly. Unlike the traditional route, which requires companies to launch their IPOs within 12 months of receiving Sebi's approval, the pre-filing route extends this window to 18 months from the receipt of final comments.

Additionally, firms can modify the primary issue size by up to 50 per cent until the updated DRHP stage.