PhonePe IPO: $15 billion potential valuation could re-rate Paytm, Macquarie says

Shares of One97 Communications, the parent of Paytm, rose another 2% on Wednesday, February 18, extending gains for a second straight session. The stock had rallied 4% on Tuesday after Macquarie published a note on “PhonePe IPO in focus, but can Paytm re-rate?The brokerage believes the proposed IPO of PhonePe could act as a near-term valuation read-through for Paytm and potentially trigger a re-rating.

PhonePe has filed its Draft Red Herring Prospectus (DRHP) and is reportedly seeking a valuation of around $15 billion. A roughly 10% stake sale by existing shareholders could raise about $1.5 billion.
Based on its last transaction with General Atlantic in September 2025, PhonePe’s implied valuation stands in the $13-15 billion range, which is about 60-90% higher than Paytm’s current market capitalisation, despite PhonePe being EBITDA-negative, while Paytm has turned EBITDA-positive.
At a $13-15 billion valuation, Macquarie estimates PhonePe would trade at 37-43 times adjusted H1 revenue, compared with roughly 19 times for Paytm.The brokerage said that PhonePe has rapidly scaled up its financial services distribution business, spanning loans, mutual funds, and insurance, with its contribution to revenue rising from 4% in FY24 to 13% in H1FY26.

Further expansion in this segment could have implications for Paytm, where nearly one-third of revenue comes from distribution.

PhonePe remains one of India’s largest fintech platforms, commanding over 45% market share in UPI transactions.

As of September 2025, it had over 657 million registered users and 47 million merchants, with UPI market share by value hovering around 49-51%, ahead of peers such as Google Pay and Paytm.

However, the DRHP also flagged potential revenue impact from recent regulatory changes, and the company continues to operate at an EBITDA loss.