LG India Surpasses Parent Company in Valuation Following Record-Breaking IPO
MUMBAI: LG India has rapidly ascended to become a $13 billion entity, exceeding the valuation of its South korean parent company following a blockbuster debut on the Indian stock market. The initial public offering (IPO) sparked a frenzy of investor confidence, accompanied by a record eight ‘buy’ ratings from leading brokerages within hours of listing.
The surge reflects optimism surrounding LG India’s strong fundamentals and the growth potential of India’s consumer durables sector. Over the past three decades, LG has established a leading franchise in key appliance categories, leveraging global research and growth, brand recognition, and efficient execution. Analysts project a robust 13% revenue CAGR and 14% EPS CAGR over FY26-28.
Emkay Global Financial Services initiated coverage with the highest price target of Rs 2,050, representing an 80% upside. “LG has, over the last three decades, built a formidable franchise, leading in key large appliance categories with premium positioning, leveraging its global R&D strength, brand power, and superior execution,” Emkay analysts stated.
Nomura forecasts a post-tax ROE/ROIC of 31%/56% in FY28F, alongside EBITDA margin expansion from 12.8% in FY25 to approximately 14.1% in FY28F. ICICI Securities highlighted LG’s “commanding market position” and core return on equity exceeding 90% when adjusted for cash and other income.
Further bullish assessments came from Prabhudas Lilladher (target Rs 1,780), Ambit Capital (Rs 1,820), Motilal Oswal (Rs 1,800), Antique Stock Broking (Rs 1,725), and equirus Securities (Rs 1,705). Common themes among analysts include LG’s dominance in the premium segment, growth opportunities stemming from low market penetration, strong return ratios, and increasing strategic importance to its korean parent.
India’s contribution to the parent company’s revenue has steadily increased, rising from 3.5% in CY21 to 4.3% in CY24, according to ICICI Securities. Under LG’s “Global South” strategy, India is projected to contribute one-third of the company’s global growth over the next five years. Ambit Capital anticipates exports to increase from 6% to 10% by FY28, driven by a doubling of capacity at the Sri City plant.
