Mumbai: LG Electronics India has become the latest company to go public with its Rs. 11,607 crore Initial Public Offering (IPO), making this one of the biggest listings in India’s consumer durables sector. Though the company remains profitable, with a strong 10.7% CAGR growth in revenues since 2023, the Korean promoters are looking to dilute their stake to unlock value.
Through this IPO, LG Electronics Inc is offloading 10.18 crore shares (25% of its holdings), with a fixed price band of Rs.1,080-1,140 per share. Almost 3.55 crores are allocated to retail investors, where they are can invest Rs.14,820 for a minimum lot of 13 shares and multiples thereafter.
Despite rising competition, LG India has carved out its name in the home appliances and air conditioning market. Just like the way Hyundai had created a name for itself in the passenger vehicles sector, LG has quietly dominated the home appliances and air conditioning sector and remains profitable to this day. The company’s home entertainment systems have expanded 2.5x in from 2019 to 2024, while the revenue from its air conditioning market has doubled from Rs.1.55 lakh crore to Rs.3.2 lakh crore in 2024.
Despite this, there is still a lot of room for growth, as refrigerators have reached just 35% of Indian households, with only 22% of households owning washing machines.
For the Koreans, this recent deluge of IPOs offers them an opportunity to unlock value, with the prices likely to get oversubscribed due to the consistent profitability of the company.The issue will run till 9th October, with the shares getting listed on 14th October.
As we speak, the Grey Market Premium (GMP), an unofficial indicator gauging investor interest, is at 28.3% of the price, indicating keen investor interest. For investors, this IPO can offer high returns in the long term, banking on LG’s 19.4% market share and consistent quality in India.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investing in stocks includes financial risks, and past performance is not indicative of future results. Readers should conduct their own research or consult with a qualified financial advisor before making any investment decisions.
