**LG Electronics India’s ₹11,600 Crore IPO Now Open: Should You Bid?**
*By Mudit Dube | Oct 07, 2025, 11:05 AM*
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**What’s the Story?**
LG Electronics India Ltd’s initial public offering (IPO) has opened for subscription today. Investors have a three-day window to participate, with the bidding closing on October 9. The company has set a price band of ₹1,080 to ₹1,140 per share. This IPO is an Offer for Sale (OFS) worth ₹11,600 crore, representing a 15% stake divestment by its South Korean parent company, LG Electronics Inc.
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**Market Valuation**
At the upper end of the price band, LG Electronics India’s market valuation stands at approximately ₹77,400 crore. On the gray market, shares of LG Electronics India are trading at a premium of ₹318. This indicates a potential listing gain of around 28% over the upper price band, making the IPO attractive for investors looking at initial gains.
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**About the Company and Business Expansion**
Founded in 1997, LG Electronics India is one of the country’s leading manufacturers and distributors of home appliances and consumer electronics. The company holds a strong presence in key categories such as washing machines, refrigerators, televisions, air conditioners, and microwaves.
LG operates two major manufacturing plants located in Noida and Pune, which contribute to approximately 85% of its sales. With a vast retail network comprising over 35,000 touchpoints nationwide, LG India has established a deep market reach.
The company has been an industry innovator, being among the first to launch 4K and Smart TVs in India in 2011 and introducing OLED TVs in 2015, further solidifying its leadership in the consumer electronics space.
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**Market Leadership and Brokerages’ Views**
Brokerages have praised the IPO for its attractive pricing, noting the company’s price-to-earnings (P/E) ratio of 35x based on FY25 estimated earnings. This is about a 50% discount compared to its peers, making the IPO a compelling opportunity.
Leading brokerage firms like Elara Capital and Choice Broking have recommended subscribing to the issue. They highlight LG’s dominant market position, steady growth trajectory, and the potential benefits arising from rising consumer demand as major positives.
Anand Rathi has also expressed optimism regarding LG’s robust market share in key product categories including washing machines, refrigerators, and televisions.
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**Financial Outlook and Performance**
Between FY22 and FY25, LG Electronics India delivered a revenue compound annual growth rate (CAGR) of 13%, despite a generally muted consumer demand environment. This growth was primarily driven by the room air conditioner segment, which expanded at a strong 15% CAGR during the period.
The company maintains an EBITDA margin of 12.8%, which is notably higher than peers like Havells, who report margins in the 9-10% range. Additionally, Elara Capital points out that LG’s localization rate has improved from 40% to 54% over the last five years and is expected to increase by 1-2% annually, supporting margin expansion and cost efficiencies.
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**Risks and Challenges**
Despite these positives, brokerages have flagged certain risks investors should be aware of before bidding. A significant contingent liability of ₹315 crore exists, relating to a revised Advance Pricing Agreement with LG’s parent company. This could require an additional royalty payment.
Analysts also caution about potential headwinds from weak consumer sentiment, ongoing supply chain disruptions, and intensifying competition in critical product categories such as air conditioners and smart TVs.
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**Should You Bid?**
The LG Electronics India IPO presents an attractive investment opportunity backed by strong market leadership, consistent growth, and favorable valuation parameters. However, investors should weigh these strengths against the highlighted risks and their own risk appetite before making a subscription decision.
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*Stay tuned for more updates on LG Electronics India’s IPO and other market news.*
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