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— PhonePe’s draft IPO prospectus

Fintech company PhonePe has temporarily shelved its initial public offering (IPO) plans amid rising geopolitical tensions due to the US-Israel war on Iran that has disrupted global equity markets, including India, with domestic benchmark indices Nifty 50 and Sensex sliding nearly 7% each since February 28.

In an official statement, the UPI payments firm said it will resume its path to a public listing once market conditions stabilise.

“We sincerely hope for a swift return to peace in all the affected regions. We remain committed to a public listing in India,” said Sameer Nigam, Chief Executive Officer (CEO) of PhonePe, though he did not specify the exact timing for the company’s IPO launch.

1. PhonePe IPO Timeline, Other Key Details: The company had initially filed draft IPO papers with the Securities and Exchange Board of India (SEBI) via the confidential pre-filing route in September 2025. It filed its Updated Draft Red Herring Prospectus (UDRHP) in January this year after getting an observation letter from the markets regulator. In SEBI parlance, an observation is official approval to proceed with the public issue.

As per SEBI guidelines, a company must launch its IPO within 12 months of receiving an observation.

PhonePe’s proposed IPO is entirely an offer for sale (OFS). This means that the company isn’t issuing any new shares and won’t receive a single rupee from the IPO. Instead, existing shareholders, including Walmart, Tiger Global and Microsoft Global Finance, will cumulatively offload up to 50.66 million equity shares.

2. New UPI Rule May Dent PhonePe’s Revenue:PhonePe’s listing plans came amid the National Payments Corporation of India’s (NPCI) proposal to cap UPI market share at 30% for any single operator. While the proposal has been extended to December 2026, it is certain to dent the revenue of PhonePe, which held a 45.5% share in the UPI market as of February 2026, as per NPCI data.

The company generated a revenue of Rs 3,231.7 crore from its payment business alone in the first six months of the fiscal year ending March 2026 (H1 FY26), accounting for over 82% of the total revenue. This underscores how transaction volumes remain central to the company’s revenue profile despite low per-transaction margins in UPI payments.

Another concern is around the lack of profitability. Over the last few years, public markets have favoured new-age startups that are profitable. However, PhonePe remains loss-making. In fact, its losses surged to Rs 1444.4 crore in H1 FY26, compared to Rs 1,203.2 crore in the same period last year.

3. Geopolitical Drama or Valuation Gap: What’s Behind the IPO Pause? 2026 opened with high expectations for Indian tech IPOs. When PhonePe filed its draft IPO papers with SEBI in January, it was said to be targeting a valuation of $15 billion.

However, Moneycontrol reported on Monday (March 16) that the UPI payments platform lowered its valuation expectations to $6-8 billionduring talks with domestic mutual fund houses due to market volatility and the ongoing West Asia war. If PhonePe had proceeded with its IPO at a lower valuation, it could have made it less attractive for existing investors looking to exit their investments through OFS.

4. Will Other Fintech IPOs Get Derailed? A number of these factors mentioned above likely made PhonePe’s IPO timing difficult, hinting that other fintechs eyeing a public listing in the near future could also struggle. This includes Moneyview, which filed its DRHP with SEBI for Rs 1,500 crore IPO earlier this month, as well as Razorpay, BharatPe and PayU — all of which are at different stages of their IPO preparations.

“Timing plays a big factor here due to the recent conflict in the Middle East and West Asia. I don’t think that we will have floodgates open like we might have hoped. In the current economic climate, other startup IPOs will also likely get delayed. Bankers may advice them to push back their planned listing and wait until the macro environment has changed,” a top-tier wealth fund told MediaNama.

PhonePe’s decision to defer its public listing plans could also have a domino effect on other new-age startups gearing up for a public listing, including quick commerce platform Zepto and hospitality firm OYO.