LG Electronics India files IPO papers to raise ₹15,000 crore

South Korean consumer electronics manufacturer LG Electronics India filed its draft red herring prospectus (DRHP) with market regulator Sebi on Friday for its maiden public issue. The issue size is expected to be around ₹15,000 crore, potentially making it India's fifth-largest IPO - after Hyundai Motors, Life Insurance Corporation, Paytm, and Coal India.

The offering is entirely an offer for sale by the promoter, LG Electronics Inc., which plans to sell 101.8 million shares, or 15% of the equity capital.

LG India is the market leader in refrigerators, washing machines and microwave ovens, while it is the second largest in AC and amongst the top two in televisions.


LG Electronics will become the second South Korean company to launch an IPO in India. Earlier in October, Hyundai Motor India raised ₹27,870 crore through its public issue, which was oversubscribed 2.37 times. The Hyundai IPO became India's largest-ever public issue, surpassing the previous record of ₹21,008 crore set by Life Insurance Corporation of India in May 2022.

India is LG's second-biggest market after the US. As per the DRHP, LG India posted a 12% rise in net profit in FY24 at ₹1,511 crore. Revenue grew by 7% to ₹21,557 crore. The filings showed LG India exported goods worth ₹1,086 crore in FY24, a 9% year on year increase.

At ₹15,000 crore public issue, the company is valued at around ₹1 lakh crore. Voltas, its closest competitor, is trading at a market capitalisation of ₹56,510 crore. Voltas has a turnover of ₹12,481 crore, and a net profit of ₹248 crore.

The company has recently made an investment proposal to the Andhra Pradesh government to jointly invest ₹7,000 crore along with its vendors to build the company's third factory in Sri City. LG Electronics will invest ₹5,000 crore, and its parts suppliers the remainder. LG plans to produce air-conditioners, refrigerators, washing machines and televisions in this facility.

Morgan Stanley, JPMorgan, Axis Capital, BofA Securities and Citi are lead managers of the issue.

LG entered the Indian market in 1997 and currently has a plant each in Greater Noida in Uttar Pradesh and in Ranjangaon near Pune. It locally manufactures almost 97-98% of what it sells.

As of June 30, 2024, LG operates 777 brand shops in India. The company paid ₹2,489 crore as dividends in FY24 and ₹2,093 crore in FY23. For FY24, LG India paid ₹403 crore as royalty to its promoter, accounting for 1.89% of its revenue from operations. In FY23 and FY22, the royalty payments were 1.63% and 1.50% of revenue from operations, respectively.