LG Electronics delays India unit IPO amid stock market volatility: Report

LG Electronics has informed advisors that it may postpone the public issue and may resume if the market conditions improve

South Korea's LG Electronics has halted work on the initial public offering (IPO) of its Indian arm amid ongoing volatility in the equity markets, Bloomberg reported on Wednesday citing people familiar with the matter. 

 

According to the report, the company has informed advisors that it may postpone the public issue and may resume if the market conditions improve. However, it is still under consideration and no final decision has been made.

 

The IPO process is still underway but the company cannot comment on the timing, the report cited an LG Electronics official in Seoul as saying. 

 

In March, Bloomberg reported that LG India's valuation could decline from $11.5 billion to $10.5 billion after the decline in the local equity markets. The LG Electronics IPO was expected to hit Dalal Street in May this year.   ALSO READ | Ather Energy IPO to end 2-months silence in mainboard segment; details here

 

 

The company has already hosted roadshows to attract investors for the IPO. It received approval from the markets regulator Securities and Exchange Board of India (Sebi) in March this year. It filed preliminary papers with Sebi in December 2024. The company aims to raise around $15 billion through the public issue, which includes an offer for sale (OFS) from its parent company. LG Electronics plans to offload a 15 per cent stake in its Indian operations. 

 

According to the draft red herring prospectus (DRHP), the parent company will sell around 101.8 million shares, amounting to a 15 per cent stake. However, the company did not disclose the total issue size. Morgan Stanley India, JP Morgan India, Axis Capital, BofA Securities India and Citigroup Global Markets India are the book-running lead managers for the IPO.   ALSO READ | LG Electronics India IPO: Strengths, weaknesses, and key details from DRHP

 

LG Electronics is the country's largest home appliances and consumer electronics player after Samsung India Electronics. As per DRHP, LG Electronics' revenue from operations in FY24 stood at ₹21,352 crore. 

 

In addition, LG Electronics is set to begin the construction of its third consumer electronics manufacturing unit in India. It will be located in Sri City, Andhra Pradesh. Currently, it operates two manufacturing facilities in the country including one in Noida and another in Ranjangaon, Maharashtra.