LG Electronics India, the Indian subsidiary of South Korean giant LG Electronics, has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise ₹15,000 crore through an initial public offering (IPO). The offer is an offer for sale (OFS) with plans to offload up to 101.8 million equity shares, representing a 15% stake in the company.
This IPO will rank as the fifth-largest in India’s history, following Coal India’s ₹15,200-crore issue in 2010. It comes on the heels of Hyundai Motor India’s (HMI) ₹27,870-crore IPO in October, which holds the record as India’s largest public offering. Despite its scale, Hyundai’s IPO received a lukewarm investor response with only 2.4 times subscription and currently trades 4% below its issue price. Like LG’s IPO, Hyundai’s offering was also entirely an OFS, with the parent company divesting a 17.5% stake in its Indian arm.
The LG Electronics India IPO comes at a time of geopolitical uncertainty, as South Korea recently faced turmoil following President Yoon Suk Seol’s declaration of emergency martial law, which was later reversed.
The book-running lead managers for LG’s IPO include Morgan Stanley India, J.P. Morgan India, Axis Capital, BofA Securities India, and Citigroup Global Markets India.
In India, LG Electronics is a dominant player in the home appliances and consumer electronics sector, second only to Samsung India Electronics.
According to the DRHP, LG Electronics India reported revenue of ₹21,352 crore in FY24, while Samsung India Electronics posted ₹99,541.6 crore in revenue during the previous fiscal year. Havells India and Godrej & Boyce Manufacturing Co. rank third and fourth, respectively, in the segment.
The Indian appliances and electronics market has grown at an annual rate of around 7% over the past five years. This growth is expected to accelerate to 12% annually over the next five years, driven by rising disposable incomes, rapid urbanization, and the increasing adoption of appliances in both urban and rural markets.
LG Electronics India faces competition from a mix of global and domestic players, including Voltas, Havells, Godrej, Blue Star, Haier, Whirlpool, Philips, Samsung, and Sony. The company’s IPO will aim to leverage its strong position in the Indian market to attract investors.
