LG to scale production, boost B2B, and lead premiumisation in India, says management

LG Electronics is set to scale production, expand its B2B business, and lead the premiumisation of consumer electronics in India, according to the company’s management.

The company is rolling out a third manufacturing plant in Sri City, Andhra Pradesh, and is introducing new products across tier 2 and tier 3 towns, while strengthening its B2B portfolio, which includes HVAC systems, information display panels, and e-blackboards.

The much-anticipated IPO of the electronics giant opened for subscription on October 6th, with the company planning to raise ₹11,607 crore through an offer for sale. The price band has been fixed between ₹1,080 and ₹1,140 per share, implying a market capitalisation of around $8.7 billion, or roughly ₹77,000 crore, at the upper end.

Speaking to CNBC-TV18, Sanjay Chitkara, Chief Sales Officer at LG Electronics India, said the timing of the IPO was strategically chosen. “Diwali is a very important season; it is big for our industry, consumer sentiment is high, and our sell-out is very good. I think that is the right time for this IPO,” he said. He added that the focus remains firmly on the Indian subsidiary’s growth and reinvestment into the market, rather than the parent company’s cash-out.

Chitkara highlighted LG’s expansion plans, noting that construction of the new Andhra Pradesh plant has already begun. “Our plan is that by the end of next year, near Diwali, we start production on our first line. There will be a phase-wise investment, and by 2029, we will complete the project. Notably, this plant is much bigger than our existing two plants—roughly three times bigger in size,” he said.

On the IPO pricing, Atul Khanna, Chief Accounting Officer, said the offer is “optimally priced in terms of market sentiment and banker guidance.” He explained that the price band leaves room for investors while reflecting the company’s strong fundamentals.

LG’s management is confident of sustaining robust growth in India. Chitkara said the market for consumer electronics, excluding mobile phones, is currently valued at $41 billion and is growing at a 14% CAGR. He added that premiumisation is accelerating, with premium products currently representing around 17% of the market, expected to rise to 25–27%. Penetration levels for appliances like microwaves, air conditioners, and washing machines remain low compared with major global markets, presenting significant opportunities for expansion.

Khanna said LG is also focusing on localisation to improve margins.

“We are procuring almost 54% of components and subassemblies in-house. Our key objective is to produce key components—the heart of the product—in our factories,” he said, noting that the company aims to continue surpassing past margin performance.

This Diwali, while consumers may look to upgrade their homes with appliances and electronics, investors will also have the chance to participate in LG’s next phase of growth in India. The company’s strategy combines production expansion, a push into premium products, and strengthening its B2B business, signalling a new chapter for LG in the country.

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