E-commerce giant Flipkart has successfully completed the process of fully separating its ownership of the digital payments network PhonePe.
As a result of this acquisition, stockholders who already had a stake in Flipkart Singapore and PhonePe Singapore, led by Walmart, have acquired ownership stakes in PhonePe India. PhonePe is now officially a fully India-domiciled firm, bringing to a close a process that the company is reported to have begun at the beginning of this year.
Following the completion of this transaction, Walmart will continue to own the majority of shares in both of the business groupings.
The Flipkart Group has produced several successful businesspeople and witnessed noteworthy ventures launched by former workers. Kalyan Krishnamurthy, CEO of the Flipkart Group, stated, “We are pleased to see PhonePe develop and prosper as a strong company in its own right.”
According to a statement released by PhonePe, establishing these businesses as independent entities will not only help unlock and maximise enterprise value for shareholders of the two companies, but it will also provide value and create new opportunities for investors to participate in the Indian technology ecosystem.
PhonePe was established in December 2015 by Sameer Nigam, Rahul Chari, and Burzin Engineer. Its UPI payment systems have digitised more than 35 million offline retailers in cities with Tiers 2, 3, 4, and beyond, representing 99% of the country’s pin codes.
2016 was the year when the PhonePe Group was taken over by the Flipkart Group. The new payment company claims to already have more than 400 million people enrolled in its platform.
Sameer Nigam, founder and CEO of PhonePe, stated that the company is excited for the next phase of its growth as it invests in new businesses such as insurance, wealth management, and lending, while also enabling the next wave of growth for UPI payments in India. “We are looking forward to the next phase of our growth as we invest in new businesses,” Nigam said.
It is important to note that in the previous year, PhonePe was granted an insurance brokerage licence by the Insurance Regulatory and Development Authority of India (IRDAI).
According to PhonePe, the company’s overall revenue had a year-on-year (YoY) increase of 133% for the fiscal year that ended on March 31, 2022. In fiscal year 22 (FY22), the young company reported a total consolidated revenue of 1,692.7 Cr, which is an increase from the 725.3 Cr reported in fiscal year 21 (FY21).
However, as a result of an increase in expenditures, PhonePe’s net loss increased by 16.4%, moving from INR 1,728.7 Cr to INR 2,013.7 Cr in FY21.
PhonePe made public its intentions earlier this year to relocate its registered organisation from Singapore to India. This move is in accordance with the company’s intentions to list on Indian stock markets in the near future. PhonePe successfully completed the process of relocating its domicile from Singapore to India later in the month of October.
