LG Electronics India Gets SEBI Nod For Rs 15,000 Crore IPO: Report

LGEI had submitted its draft red herring prospectus to SEBI on December 6. The IPO will be an entirely offer-for-sale with the parent company, LG Electronics, aiming to sell a 15 per cent stake

In its DRHP, LGEI highlighted that India’s appliances and electronics market has grown by around 7 per cent over the past five years

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Electronics giant LG Electronics India (LGEI) has received approval from the Securities and Exchange Board of India (SEBI) to proceed with its first-ever share sale, according to a Business Standard report citing sources on Thursday.

The Indian subsidiary of the Seoul-based home appliances and electronics company is planning to launch its Rs 15,000 crore initial public offering (IPO) as soon as market conditions become favourable, the report added.

LGEI had submitted its draft red herring prospectus (DRHP) to SEBI on December 6. The IPO will be an entirely offer-for-sale (OFS) with the parent company, LG Electronics, aiming to sell a 15 per cent stake. The IPO could potentially value LGEI at Rs 1 trillion.

LGEI's IPO will become India’s fifth-largest, following Hyundai Motor India’s (HMI) record Rs 27,870 crore IPO in October last year. Like LGEI’s offering, HMI’s IPO was also a full offer-for-sale (OFS), with Hyundai, based in Seoul, selling a 17.5 per cent stake in its Indian subsidiary.

In India, LG Electronics ranks as the second-largest player in the home appliances and consumer electronics sector, behind Samsung India Electronics. The company faces competition from both global and Indian brands, including Voltas, Havells, Godrej, Blue Star, Haier, Whirlpool, Philips, Samsung, and Sony.

The book-running lead managers for the IPO are Morgan Stanley India, J.P. Morgan India, Axis Capital, BofA Securities India, and Citigroup Global Markets India.

In its DRHP, LGEI highlighted that India’s appliances and electronics market has grown by around 7 per cent over the past five years. This growth is expected to accelerate to approximately 12 per cent in the next five years, driven by factors such as rising disposable incomes, increased urbanisation, and greater penetration of appliances and electronics in both urban and rural areas, states the report.

For FY24, LGEI reported revenue from operations of Rs 21,352 crore, while Samsung India Electronics generated Rs 99,541.6 crore in revenue in the previous financial year, according to the company’s DRHP.