The listing marked the best performance for a billion-dollar IPO in India since 2021, placing the company ahead of peers Whirlpool, Voltas and Havells.

Shares of LG India opened at Rs 1,715 on the BSE and Rs 1,710.10 on the NSE, compared with an issue price of Rs 1,140 per share, giving investors a listing-day gain of more than 50%. The rally lifted the company’s market value beyond all other Indian-listed consumer durable peers, including Whirlpool of India ($1.7 billion), Voltas ($5.8 billion) and Havells India ($10.4 billion).

The Rs 11,607-crore initial public offering was entirely an offer for sale by LG Electronics Inc. It drew overwhelming investor demand, with total bids exceeding the issue size 54 times. The qualified institutional buyers’ portion was subscribed to 166 times, while retail investors bid 3.5 times their allotted quota.

Ahead of the debut, the shares were commanding a 31% premium in the grey market, reflecting strong investor appetite. The robust listing gave LG India the highest listing-day premium of 50.4% among IPOs exceeding Rs 10,000 crore.

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The debut comes amid India’s second-busiest quarter on record for IPOs, although recent large issues such as WeWork India and Tata Capital posted muted debuts.India’s record with large listings has been uneven. Coal India’s 2010 IPO, which raised Rs 15,199 crore, remains one of the few success stories, listing nearly 40% higher. In contrast, Reliance Power’s 2008 offering listed 17% lower, while Paytm’s Rs 18,300-crore IPO in 2021 dropped 27% on debut. Even state-backed giants have struggled, with LIC’s Rs 20,557-crore IPO listing 7.8% lower and GIC Re’s Rs 11,257-crore issue debuting with a 4.6% loss.Against this backdrop, LG India’s performance stands out as a rare exception among India’s mega IPOs, combining both scale and strong investor response.

The IPO triggered a strong show of analyst confidence, with at least eight brokerages issuing buy ratings within hours, reflecting optimism on LG India’s fundamentals and India’s consumer durables sector.

Emkay Global Financial Services led with a Rs 2,050 price target, implying an 80% upside. “LG has, over the last three decades, built a formidable franchise, leading in key large appliance categories with premium positioning, leveraging its global R&D strength, brand power, and superior execution,” Emkay analysts wrote, projecting 13% revenue CAGR and 14% EPS CAGR over FY26–28.

Nomura initiated coverage with a buy rating and Rs 1,800 target, forecasting post-tax ROE/ROIC of 31%/56% in FY28F and EBITDA margin expansion from 12.8% in FY25 to ~14.1% in FY28F. ICICI Securities highlighted LG’s “commanding market position” and core return on equity exceeding 90% when adjusted for cash and other income.

Other brokerages also turned bullish: Prabhudas Lilladher set a target of Rs 1,780, Ambit Capital Rs 1,820, Motilal Oswal Rs 1,800, Antique Stock Broking Rs 1,725, and Equirus Securities Rs 1,705. Analysts noted LG’s premium segment dominance, growth tailwinds from underpenetration, strong return ratios, and increasing strategic relevance to its Korean parent.

Also read | LG share price target at Rs 2,050? Korean giant sparks record frenzy with 8 buy calls on Day 1

ICICI Securities pointed out that India’s share of the parent’s revenue rose from 3.5% in CY21 to 4.3% in CY24. Emkay added that under LG’s “Global South” strategy, India is expected to contribute one-third of global growth over five years, while Ambit noted exports could rise from 6% to 10% by FY28 as Sri City plant capacity doubles.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)

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