Brokerages have lined up bullish calls on LG Electronics India Ltd (LGEIL) ahead of its IPO listing, projecting as much as 80 per cent upside for the stock.
Both Motilal Oswal Financial Services (MOFSL) and Emkay Global have initiated coverage with ‘Buy’ ratings, setting target prices between Rs 1,800 and Rs 2,050. ICICI Securities suggested a lower target of Rs 1,700.
MOFSL has assigned a target price of Rs 1,800, valuing the stock at 40 times FY28E EPS. The brokerage said LG’s category leadership, rising localisation, and growing exposure to exports and B2B segments position it well to benefit from India’s rapidly expanding consumer electronics market. It expects India’s home appliances and electronics industry (excluding mobile phones) to post around 14 per cent CAGR between 2024 and 2029.
“We model LG India to report revenue/PAT CAGR of 9.3 per cent/7.9 per cent over FY25-28E. We initiate coverage on the stock with a BUY rating and a DCF-based target price of INR 1,700 (implying 45 times FY27 and 42 times FY28 earnings),” ICICIdirect said.
The brokerage highlighted that LG’s strategy to balance premium and mass-market offerings, while making advanced features more affordable, should broaden its customer base and enhance brand equity. It projects strong financial performance, with return ratios (RoE/RoIC) of about 30 per cent and 66 per cent, alongside average operating cash flow conversion of 74 per cent during FY26-FY28. MOFSL believes continued localisation, premiumisation, and growth in higher-margin B2B and AMC businesses will sustain margin expansion and long-term value creation.
Emkay Global, meanwhile, has set a target price of Rs 2,050, implying an 80 per cent upside from current levels. The brokerage values the stock at 50 times Sep-27E earnings, a 10 per cent premium to Havells, reflecting LG’s strong brand equity, diversified category leadership, and growing strategic importance within the parent company’s global expansion plans.
Emkay expects LG’s revenue and EPS to grow at 13 per cent and 14 per cent CAGR, respectively, over FY26-FY28, supported by stable margins of around 13 per cent, healthy free cash flows, and a net cash balance sheet. It forecasts robust average RoE of 32 per cent and RoCE of 44 per cent, with net cash likely to rise from Rs 3,700 crore in FY25 to around Rs 5,000 crore in FY28E. The brokerage also expects an average dividend payout ratio of 65 per cent during FY27-FY28 and estimates free cash flow to equity (FCFE) yield of 7.6 per cent by FY28E.