Brokerages upbeat on LG Electronics IPO: GMP up 28%; should you subscribe?

Early grey market trends reflect strong investor interest ahead of the launch of the LG Electronics India IPO

Market analysts remain upbeat on the initial public offering (IPO) of LG Electronics India, which opens for public subscription today, October 7. The maiden share sale by the Indian arm of South Korean conglomerate LG Electronics Inc. is an entirely offer for sale (OFS) issue, through which the promoter aims to raise ₹11,607 crore by offloading equity shares.

 

Ahead of the IPO opening, LG Electronics India successfully raised ₹3,475 crore from a robust anchor book on October 6, reflecting strong institutional appetite. The anchor round saw widespread participation from foreign as well as domestic investors, including the Singapore Government, Goldman Sachs, Fidelity Funds, BlackRock Global Funds, Abu Dhabi Investment Authority, Government Pension Fund Global, as well as leading Indian institutions like SBI Mutual Fund, HDFC Mutual Fund, ICICI Prudential Mutual Fund, Kotak Mutual Fund, SBI Life Insurance, HDFC Life Insurance, and ICICI Prudential Life Insurance.

 

 

Adding to the upbeat sentiment, grey market trends indicates favourable demand among investors. Sources tracking unofficial market activity revealed that the unlisted shares of LG Electronics were exchanging hands at around ₹1,458 per share, reflecting a grey market premium (GMP) of ₹318 per share or nearly 27.89 per cent, over the upper price band of ₹1,140.  ALSO READ| Investing in LG Electronics IPO? Don't miss these risks, strengths from RHP

Should you subscribe to LG Electronics IPO? Here’s what the brokerages recommend:

ICICI Securities – Subscribe

Analysts at ICICI Securities have assigned a Subscribe rating on the LG Electronics IPO, citing that the company has proven its ability to leverage the strong brand, technical know-how, and execution capabilities as reflected in its strong market share across product categories. It has a cash-rich balance sheet with superior margin and return ratios. Further, the company continues to invest growth capital to cater to under-penetrated domestic home appliance and consumer electronic products along with positioning for export opportunity.

 

"All these factors, coupled with MNC parentage, make the issue attractively priced. Thus, we assign Subscribe rating on LG Electronics India IPO," wrote the analysts in a research note.

SBI Securities – Subscribe

Those at SBI Securities have also recommended investors subscribe to the LG Electronics IPO, citing that compared to its closest peers, the company outshines them in most valuation parameters with a superior return profile. The analyst further pointed out that it has one of the largest in-house production capabilities among peers in India, making it a giant in the industry. The company’s robust Revenue/EBITDA/PAT CAGR of 10.8 per cent / 28 per cent / 27.8 per cent respectively during FY23–FY25 portrays its financial prowess.

 

"At the upper price band of ₹1,140, the issue is valued at a P/E multiple of 35.1x based on the post-issue capital. When comparing to its closest peers, the company outshines them in most valuation parameters with superior return profile. We recommend investors to Subscribe to the issue," wrote the analysts in a research note.

Anand Rathi Research Team – Subscribe

Brokerage firm Anand Rathi Research Team has assigned a Subscribe rating on LG Electronics IPO, citing its strong legacy brand recognition with market leadership across multiple consumer durables products along with in-house production capacity among the peers in India, making it a giant in the industry.

 

The analyst highlighted that the company's leadership in India’s home appliances and consumer electronics industry is driven by a combination of its strong brand equity, pioneering innovation, extensive distribution reach, robust manufacturing infrastructure, and long-standing supplier relationships — all backed by the global strength and technological capabilities of LG Electronics Inc.

 

"On the valuation front, based on annualised FY26 earnings, the company is seeking a P/E of 37.6 times, and a post-issue market capitalisation of approximately ₹77,380.1 crore, making the issue appear to be reasonably priced," said the brokerage.

LG Electronics India IPO details

LG Electronics IPO is a book-build issue, which comprises an entirely offer for sale (OFS), with promoter LG Electronics Inc. divesting up to 101.81 million equity shares worth ₹11,607.01 crore.

 

The public offering is available at a price band of ₹1080–1140 per share with a lot size of 13 shares. Thus, the investors can bid for a minimum of 13 shares and in multiples thereof. A retail investor would need ₹14,820 to bid for one lot of 13 shares, while ₹1,92,660 is required to bid for a maximum of 13 lots (169 shares).

 

The three-day subscription window to bid for the LG Electronics IPO will close for subscription on October 9. Following that, the basis of allotment of the company’s shares is likely to get finalised on October 10. The successful allottees will receive the company's shares in their demat account tentatively on Monday, October 13.

 

LG Electronics shares are slated to make their D-Street debut tentatively on Tuesday, October 14.

 

Since the public offering comprises an entirely offer for sale of equity shares, LG Electronics India will not receive any proceeds from the offering, and it will be given to LG Electronics Inc., the promoter selling stake through OFS.

About LG Electronics India

Incorporated in 1997, LG Electronics India (LGEDIA) is a wholly owned subsidiary of LG Electronics Inc., which is a leading single-brand global home appliance player. LGEDIA is the market leader in India across multiple product categories including washing machines (33.5 per cent), refrigerators (29.9 per cent), panel televisions (27.5 per cent), inverter air conditioners (20.6 per cent), and convection microwaves (51.4 per cent) as on H1CY25.