LG Electronics India IPO: Motilal Oswal Predicts 83% Upside
LG Electronics India’s shares are likely to soar after the company listed its stock in the stock market. The research brokerage Motilal Oswal has estimated the stock’s “bull case” scenario potential upside to be as high as 83%. The excitement is building as the company readies its listing on October 14. This is in a significant milestone for one of India’s leading consumer electronics and home appliance brands.
What motivates this driver? There is a lot of interest from investors. It is also becoming a talking point in the latest paradigm’s possibilities of news headlines about businesses and the stock market in India.
Motilal Oswal’s Expectations and Recommendations
Motilal Oswal initiated coverage on LG Electronics India with a strong “buy recommendation. They established a base case price target of ₹1,800 per share. It implies a potential upside of 58% to the issue price of ₹1,140.
In a bullish case, the brokerage has projected a price target of ₹2,085 which implies an 83% upside from the price issue. This is a bold forecast given the confidence in LG’s upcoming growth and position in the market.
According to the brokerage, LG’s strong financial track record, timely special product range, and growing market share opportunity position LG to be a potential player in India’s rapidly growing consumer durables industry.
A Thriving Market for Consumer Electronics in India
India’s consumer electronics and home appliances sector is anticipated to grow rapidly at a CAGR of 14% between FY2024 and FY2029.
According to Motilal Oswal, LG Electronics India is well-positioned in product categories like televisions, refrigerators, and air conditioners. It will benefit from growth in the overall industry.
By focusing on continued innovation, localization, and customer storefront, the company will have a competitive advantage in growing its market footprint and creating an ongoing growth story.
Strong Financial Outlook and Competitive Advantage
Motilal Oswal expects LG Electronics India to deliver strong return ratios. It is with an expected Return on Equity (RoE) of 30% and Return on Invested Capital (RoIC) of 66% during FY2028.
Key factors contributing to this positive outlook are as follows:
- Increased conversion of operating cash flow
- Focus on localization to improve profit margins.
- Growth in profitable B2B and AMC segments.
- Leadership in important consumer segments
Further, LG’s extensive distribution and service network is another competitive advantage. The company has more than 1,000 service centers in India to support customers with after-sales service.
Motilal Oswal noted that LG spends around 4.5% of revenue on advertising– which they expect will continue through possibly FY2028– to increase brand awareness and customer engagement.
Historic IPO Subscription Levels
LG Electronics India’s IPO generated noteworthy interest and was oversubscribed to a tune of ₹4.5 lakh crore to capture the title of the highest subscribed IPO in India with respect to the previous record set by Bajaj Finance.
This robust response from the investor community is reflective of solid faith in LG’s growth story, market leadership, and intact long term profitability potential.
Primary Risks and Headwinds Ahead
Although there are positive thoughts, Motilal Oswal cautioned investors of downside risks. This involves:
- Potential increase in royalty payments to LG Electronics Korea, which may impact margins.
- Volatility in raw material prices, especially metals and electronic components.
- Further competitive intensity in the consumer durables industry extending to domestic and international players.
Despite these challenges, the brokerage continues to feel that LG Electronics India’s sound fundamentals and business model will enable it to deal with them effectively.
As LG Electronics India embarks on its journey into the stock market, investor sentiment remains highly positive.
The company is at the forefront of consumer electronics transformation in India with its strong growth potential, record IPO success, and positive analyst predictions.
For investors who have read the latest news on business, LG Electronics India’s IPO is one of the major developments of 2025, demonstrating the resilience of India’s capital markets and the rise of the homegrown consumer technology brands.
