LG Electronics India's ₹11,607 crore IPO draws record ₹4.4 trillion bids

LG's Rs 11,607-crore IPO drew record demand from investors, making it the most subscribed large-cap issue since 2020, with strong institutional and HNI interest

LG Electronics India’s ₹11,607 crore initial public offering (IPO) turned out to be a blockbuster, attracting bids worth ₹4.4 trillion — the highest for a domestic listing. 

The appliance major topped the record held by Bajaj Housing Finance, whose ₹6,560 crore IPO had evoked bids worth ₹3.24 trillion last year. 

The $50 billion worth of bids generated by LG demonstrated the depth of the Indian market, which is set to wrap up its busiest week in terms of IPO mobilisation. A day earlier, Tata Capital successfully closed its ₹15,512 crore IPO. 

LG’s share sale saw 54 times more demand than shares on offer, with the quota meant for institutional investors garnering 166 times subscription. The retail and high networth individual (HNI) portion were subscribed 3.6 times and 22.4 times, respectively. The IPO saw over 6.5 million applications. 

 

A day before opening, LG raised ₹3,420 crore from anchor investors, including marquee names such as the Government of Singapore, Abu Dhabi Investment Authority, and global asset managers like BlackRock.

 

The IPO — the eighth biggest in the domestic market — was an entirely offer-for-sale by the South Korea-based parent, who divested 15 per cent of its stake. This is LG’s first listing outside its home market.

 

“This IPO marks not just a financial milestone, but a reaffirmation of our long-term commitment to India…the success of our IPO also mirrors the strength and optimism of India’s strong growth and consumption story – one that we are deeply proud to be a part of,” said Hong Ju Jeon, managing director at LG Electronics India.

 

LG’s India IPO came close on the heels of Hyundai Motor India’s ₹27,869 crore listing last year, which was the country’s largest. However, Hyundai’s IPO, however, drew a lukewarm response, with total bids of less than ₹50,000 crore and a 2.4x subscription.

 

LG’s Indian arm was valued at about ₹77,400 crore in the IPO, lower than the ₹1.3 trillion figure quoted in media reports when the offer document was filed.

 

Analysts said the huge demand for LG’s IPO was on account of attractive valuations relative to its peers.

 

“LG’s IPO is priced at a forward P/E of around 35x, lower than most listed branded consumer companies in India. With FY2025 ROE at 45 per cent, it outperforms all peers in the home appliances and consumer electronics segment, and exceeds the return profile of most FMCG companies,” wrote analyst Devi Subhakesan of Investory who publishes on Smartkarma.

 

LG competes with Voltas, Havells, Godrej, Blue Star, Haier, Whirlpool, Philips, Samsung, and Sony.

 

“Given the sector’s strong growth potential, coupled with LG India’s market leadership and brand strength, the company is well-positioned for robust growth. Consequently, the stock is expected to trade at multiples in line with or at a premium to peers. Supporting this outlook, the grey market premium — reflecting unofficial pre-listing demand — stands above ₹300, indicating a potential 30 per cent listing gain,” Subhakesan added.