PhonePe secures $600M investment from General Atlantic ahead of IPO
What's the story
Walmart-backed fintech giant PhonePe has secured a $600 million investment from General Atlantic (GA). The funding doubles GA's stake in the company from 4.4% to 9%. The primary purpose of this investment is to help PhonePe employees meet their tax liabilities arising from exercising their Employee Stock Options (ESOPs) before the company's highly anticipated initial public offering (IPO).
Investment details
GA's total investment in PhonePe surpasses $1.15 billion
The latest funding round is mostly secondary in nature and does not involve any share sale by the founders or existing investors. With this latest infusion, General Atlantic's total investment in PhonePe has reached $1.15 billion since 2023. This shows the private equity firm's faith in the company's growth potential as it prepares for its public debut with a draft red herring prospectus (DRHP) filing later this year.
IPO prospects
PhonePe's ₹12,000 crore IPO to include major shareholder stake sales
PhonePe is targeting a ₹12,000 crore ($1.35 billion) IPO through an offer for sale (OFS). Major shareholders such as Walmart, Tiger Global, and Microsoft are expected to offload some of their stakes in the offering, which may lead to a 10% dilution. The company's financial performance has also improved ahead of its listing with a 40% year-on-year revenue growth to ₹7,115 crore in FY25.
Business expansion
PhonePe's dominance in UPI space and expansion into financial services
Despite stiff competition, PhonePe has maintained its dominance in the UPI space. In September 2025 alone, it processed 8.9 billion transactions, accounting for over 45% of the UPI market share. The company has also diversified its offerings to become a full-stack financial services platform providing credit, insurance, and brokerage services. Each business vertical is now a separate entity with its own CEO.