LG Electronics Inc is reportedly looking to raise the valuation of its Indian subsidiary to up to $15 billion in a planned listing next year.
A Bloomberg report on Monday said the Korean company decided on the move after receiving initial feedback from analysts and investors.
The home appliances and consumer electronics player is planning to start a formal roadshow of the initial public offering (IPO) of the Indian subsidiary — LG Electronics India — within the next two months.
The Korean chaebol is expecting a listing in the first half of 2025. The company had earlier eyed a valuation of around $13 billion.
Earlier this month, LG Electronics India filed preliminary papers with the Securities and Exchange Board of India (Sebi).
The proposed IPO will entirely be an offer for sale (OFS) of 10.18 crore equity shares by promoter LG Electronics Inc with no fresh issue component, according to the draft red herring prospectus (DRHP).
Its South Korean parent company LG Electronics Inc will sell 10.18 crore equity shares. After the offer, its shareholding will be diluted 15 per cent to 57.69 crore shares in the company.
Since the public issue is completely OFS, LG Electronics India will not receive any proceeds from the IPO.
In its draft papers, LG Electronics India said it expects the listing of the equity shares will enhance its visibility and brand image and provide liquidity and a public market for the shares.
LG Electronics India plans to set up a plant in Andhra Pradesh.
Besides, it is increasing the sourcing of raw materials from the local market, allowing the company to competitively price the products.
The merchant bankers to the issue are — Morgan Stanley India Company, JP Morgan India, Axis Capital, BofA Securities India and Citigroup Global Markets India.
During the financial year ended March 31, 2024, the company saw its revenue from operations standing at ₹64,087.97 crore.
In October, Hyundai Motors India Ltd (HMIL) was listed on the domestic bourses. Its shares closed at ₹1,818.05 on Monday, a rise of 2.62 per cent over the last finish. At this price, its market cap stands at ₹1.47 lakh crore.
LG Electronics’ proposed IPO comes at a time the domestic primary market is witnessing hectic activity.
Last week three issues — MobiKwik, Vishal Mega Mart and Sai Life Sciences — generated investor interest of over ₹2 lakh crore.
