TINA factor driving LG multiples

The maiden quarterly result of LG Electronics India Ltd after it listed in October was nothing close to electrifying. Ebitda fell 27.7% year-on-year to ₹548 crore in the September quarter (Q2FY26) and the margin contracted 350 basis points (bps) to 8.9%.

- Manish Joshi

Profitability was marred by commodity cost inflation. Raw material costs increased to 70.6% of sales from 68.2% year-on-year and sales promotion expenses were higher. This led to steep earnings per share cuts by brokerages.

Revenue grew 1% year-on-year to ₹6,174 crore. Even so, this was better than peers that reported revenue declining in Q2. LG also gained market share, said Centrum Broking.

The implementation timeline of GST 2.0 weighed on LG's Q2 result. LG raised prices by 1.5%-2% for refrigerators and washing machines, which together accounted for 48% of its sales in FY25. This should ensure that LG returns to a double-digit

uation of 40x P/E, based on Bloomberg consensus estimates for FY27.