Broker’s call: LG Electronics (Accumulate)

Target: ₹1,750

CMP: ₹1,573.10

LG Electronics India is the undisputed leader in India’s consumer durable market, with decade-long dominance in the space. LGEIL is re-entering the economy segment via its LG Essential series in tier II-III markets and in the traditional channel, initially in refrigerators and washing machines, followed by room air conditioners and microwaves.

We believe LGEIL would see accelerated revenue growth of 14-16 per cent (upside case) in FY26E-30E over a large base from the current growth of 11 per cent if it were to mirror Haier’s blueprint of aggressive pricing, large capex and surging localisation, while preserving superior return profile.

An earnings CAGR of 18 per cent in FY26E-28E should be underpinned by: rising localisation with backward integration into products such as compressors and PCBs, unlike domestic peers; strong parental support for R&D and technology, enabling bridging product gaps between the parent and India operations ; and premium portfolio with leadership in high-value categories.

LGEIL is incurring a capex of ₹5,000 croreat Sri City, Tamil Nadu in the next four years. This may translate into revenue of ₹20,000-25,000 crore (asset turnover at 4-4.5x) once fully ramped up.

We initiate with Accumulate and a TP of ₹1,750, based on 45x FY28E P/E. Key risks are slowdown in demand in India’s consumer durables industry, intensifying competitive landscape, inability to pass on price rise and contingent liability related to royalty payment to the parent.

Published on March 10, 2026