LG Electronics Plans To Sell Stake In Its Indian Subsidiary

LG Electronics has announced the restart of the initial public offering (IPO) process for its Indian subsidiary, aiming to sell a 15 percent stake in the company on the local stock market, Azernews reports, citing Korean media.

On Tuesday, LG's board of directors approved the sale of 101,815,859 shares, representing a 15 percent ownership in the wholly-owned Indian unit. This move is part of LG's broader strategy to raise funds for its headquarters in South Korea by listing the subsidiary on the Indian stock exchange.

The company plans to submit the final prospectus to the Securities and Exchange Board of India (SEBI) shortly, with the IPO expected to be completed as early as October. While the exact valuation and disposal date are yet to be finalized, LG confirmed that details regarding the share price range and schedule will be disclosed following SEBI's final approval.

The IPO process was paused for five months amid global market volatility and trade policy uncertainties triggered by tariff measures under former U.S. President Donald Trump. LG initially filed a preliminary application with SEBI in December 2024 and received conditional approval in March 2025, before putting the process on hold in April.

Local Indian media estimate the IPO's value at around 115 billion rupees (approximately $1.3 billion). Since the offering will involve only existing shares-with no new stock issuance-the proceeds will go directly to LG Electronics, allowing the company to raise capital without incurring debt or financing costs.

According to LG Electronics' semiannual report, its standalone cash and cash equivalents stood at 1.1 trillion won ($784.5 million) as of the end of Q2 2025. A successful IPO could more than double this cash reserve, significantly bolstering the company's financial stability.

However, LG Electronics continues to face challenges amid declining global demand for home appliances and TVs, compounded by the effects of trade tariffs. In Q2 2025, the company reported a 4.4 percent drop in revenue and a sharp 46.6 percent decline in operating profit compared to the same period in 2024.

Market analysts, including local tracker FnGuide, predict further declines in Q3, with revenue and operating profit expected to fall by 4.1 percent and 18.4 percent, respectively, year-on-year.

To navigate these headwinds, LG launched a voluntary retirement program last month, starting with its Media Entertainment Solution division, which manages TV operations. The company is also shifting focus toward expanding high-margin businesses such as heating, ventilation, and air conditioning (HVAC), while actively exploring growth opportunities in Southeast Asia, particularly in the rapidly growing Indian market.

LG is currently the market leader in home appliances in India. Its local unit reported robust performance in the first half of 2025, generating 2.28 trillion won ($25.7 billion) in revenue and 209.7 billion won ($149.6 million) in net profit.

MENAFN30092025000195011045ID1110132520