BUSINESS OVERVIEW

LG Electronics India Limited (LGEIL) is the number one player in major home appliances and consumer electronics (excluding mobile phones) in India for the six months ended June 30, 2025, and for CY2024, CY2023, and CY2022, based on market share (in terms of value) in the offline channel, according to the Redseer Report. The company also holds the leadership position across multiple product categories, including washing machines, refrigerators, panel televisions, inverter air conditioners, and microwaves, as per the same report.

The offline channel, which accounted for approximately 78% of the major home appliances and consumer electronics market in CY2024 and 77% in H1CY2025, continues to be the largest sales avenue. Additionally, as of the 12-month period ending December 31, 2024, and the six months ended June 30, 2025, eight out of ten air conditioners sold in India were based on inverter technology, demonstrating the country’s rapid adoption of energy-efficient solutions, as per the Redseer Report.

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Corporate Background and Parentage

Incorporated in 1997 as a wholly owned subsidiary of LG Electronics, LGEIL benefits from its parent company’s position as the leading single-brand global home appliances player by revenue in CY2024, according to the Redseer Report. The LG brand, featured in Interbrand’s Top 100 Best Global Brands (2024), provides a significant competitive edge through global recognition, technological innovation, and consumer trust.

This strong parentage enables access to advanced technologies, robust R&D capabilities, and quality-driven manufacturing standards, positioning LGEIL as one of the most trusted and technologically advanced appliance brands in India.

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Product Portfolio and Segments

LGEIL offers one of the widest product portfolios among major home appliances and consumer electronics players in India (excluding mobile phones), catering to both B2C and B2B customers across domestic and international markets. The company’s activities are organized into two primary business segments:

1. Home Appliances and Air Solutions, and

2. Home Entertainment.

The portfolio also includes installation, repair, and maintenance services for all products, ensuring an integrated consumer experience.

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Technological Leadership

With 28 years of operational experience in India, LGEIL has developed a deep understanding of Indian consumer preferences and regional demands. Leveraging the global innovation leadership of LG Electronics, the company has consistently introduced new and localized technologies for Indian households.

• Pioneer in inverter air conditioners: Among leading players, LGEIL was one of the first to introduce inverter ACs in 2014, and by 2017, became the first and only company in India to transition its entire AC portfolio to inverter technology, according to the Redseer Report.

• Innovation in water purifiers: In 2013, it became the first player in India to shift from plastic tanks to stainless steel tanks in water purifiers.

• As of June 30, 2025, eight out of ten ACs sold in India use inverter technology, underscoring the brand’s influence on market-wide technology adoption.

This consistent innovation underscores LGEIL’s commitment to energy efficiency, durability, and sustainability.

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Distribution and Service Network

According to the Redseer Report, LGEIL operates the largest distribution network among home appliances and consumer electronics players in India as of June 30, 2025. The network extends across urban and rural regions, comprising:

• 35,640 B2C touchpoints for the three months ended June 30, 2025,

• 463 B2B trade partners, and

• 286 dedicated customer service employees.

The company maintains long-standing trade relationships, with 49.46% of trade partners associated for over 10 years, strengthening channel reliability and brand presence.

Complementing this distribution reach, LGEIL operates one of the largest after-sales service networks in India, with:

• 1,006 service centers,

• 13,368 service engineers, and

• 4 call centers (as of June 30, 2025).

The company also offers same-day installations and proactive service engagement, ensuring high customer satisfaction and operational excellence.

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Manufacturing Capabilities

LGEIL possesses one of the largest in-house manufacturing capacities (excluding mobile phones) among leading players in India.
The company operates two advanced manufacturing facilities located in Noida and Pune, with a combined installed capacity of 14.51 million products as of June 30, 2025.

Key highlights include:

• Manufacture of critical components, such as compressors and motors, enabling cost control, superior quality, and supply reliability.

• Flexible assembly lines capable of producing multiple product categories, ensuring quick response to consumer demand.

• In-house smart monitoring systems designed to reduce incident rates and enhance operational efficiency.

• Aggregate capacity utilization of 76.80% in FY2025, on a double-shift basis at the Noida unit (except microwave ovens, operating on a single shift).

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Expansion Plans

A third manufacturing unit is being developed in Andhra Pradesh, with an investment of ₹50.01 billion, as approved by the Board on November 8, 2024.
A memorandum of understanding (MoU) with Sri City Private Limited was signed on January 17, 2025, for land allotment on a 99-year lease.
Construction management agreements were executed on September 8, 2025, and administrative sanction with fiscal incentives was received from the Government of Andhra Pradesh.

The new facility is expected to be operational by FY2027, initially producing air conditioners and compressors, followed by washing machines and refrigerators in subsequent years.

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Supply Chain and Localization

LGEIL’s pan-India supply chain includes 25 product warehouses, comprising 2 Central Distribution Centers (CDCs) and 23 Regional Distribution Centers (RDCs).
This network enables efficient inventory management and reduced delivery times, ensuring 6–7 day delivery to trade partners’ warehouses during FY2025.

The company partners with 287 suppliers, maintaining relationships averaging 13.13 years.
Its Make in India commitment is reflected in increasing localization levels, with domestic raw material sourcing rising from 48.82% in FY2024 to 54.12% in Q1FY2026.
This localization effort provides faster procurement cycles, lower inventory costs, and competitive pricing advantages.

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Sustainability, Social Impact, and Governance

LGEIL’s commitment to sustainability is evident through its energy-efficient product portfolio—holding the highest percentage of 5-star BEE-rated products across air conditioners, refrigerators, and washing machines, among leading players in India as of June 30, 2025, according to the Redseer Report.

Product inclusivity is another key focus area, exemplified by the introduction of braille remotes for air conditioners, enhancing accessibility for visually impaired consumers.

Through its CSR philosophy, “Life’s Good When We Do Good,” LGEIL focuses on nutrition, healthcare, and education, creating long-term value for consumers, trade partners, and communities.

The company upholds high corporate governance standards, operating with fairness, transparency, and integrity. It has also been certified as a “Great Place to Work” (Oct 2024 – Oct 2025), reinforcing its strong employee-centric culture.

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Global Parentage and Management Strength

LG Electronics, the global parent, is recognized as the world’s leading single-brand home appliances player by revenue in CY2024, as per the Redseer Report. The global network contributes technological expertise, manufacturing excellence, and marketing strength to the Indian subsidiary.

LGEIL’s operations in India are supported by a seasoned management team with long-term industry experience:

• Sanjay Chitkara, Chief Sales Officer – over 26 years of association.

• Ashish Agrawal, Chief Operating Officer – over 25 years of association.

• Atul Khanna, Chief Accounting Officer – over 21 years of association.

• Gagan Jeet Singh, Chief Manufacturing Officer – over 27 years of industry experience.

This leadership synergy blends global governance standards with local market expertise, ensuring sustainable growth and operational excellence.

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Financial Strength

LGEIL’s operations are structured across two major business verticals:

1. Home Appliances and Air Solution, and

2. Home Entertainment.

The company’s robust performance, backed by technological leadership, efficient supply chain, localized manufacturing, and brand trust, underpins its position as India’s premier home appliances and consumer electronics brand. The Bankers to the company are Emirates NBD Bank, Citibank N.A., HDFC Bank Limited, Hongkong and Shanghai Banking Corporation Limited and ICICI Bank Limited.

INDUSTRY ANALYSIS

India Appliances & Electronics Market Overview

As of H1CY2025 (Annualized), India’s appliances and electronics market is valued at approximately ₹6,875 billion (US$81 billion), marking steady growth from ₹6,370 billion (US$75 billion) in CY2024. Between CY2019 and CY2024, the industry expanded at a CAGR of ~7%, and it is projected to reach ₹10,965 billion (US$129 billion) by CY2029P, growing at an accelerated 5-year CAGR of ~11%.

In terms of volume, the B2C segment sold around 495 million units in CY2024, which is expected to increase to nearly 660 million units by CY2029P, reflecting a CAGR of ~6%.

Key growth drivers include rising disposable incomes, urbanization, higher appliance penetration, government incentives for local manufacturing, and a consumer shift toward premium and energy-efficient products. Additionally, the expansion of organized retail and e-commerce continues to enhance market accessibility and affordability.

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Market Leadership and Competitive Landscape

The market features a diverse set of players, with LG Electronics India Pvt. Ltd. (LGEIL) consistently maintaining a #1 position across major home appliances and consumer electronics (excluding mobile phones) in India for H1CY2025, CY2024, CY2023, and CY2022, based on value share in the offline channel (GfK data).

LGEIL leads multiple categories, including washing machines, refrigerators, panel TVs, inverter ACs, and microwaves, confirming its dominant offline presence.
As of December 2024, the offline channel contributed ~78% of the total major home appliances and consumer electronics market (excluding mobile phones), with a ~77% share in H1CY2025.

Interestingly, around eight out of ten air conditioners sold in India during the 12 months ending June 30, 2025, are based on inverter technology, underlining the growing preference for energy efficiency.

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Market Composition: B2C and B2B Segments

The India Appliances & Electronics Market can broadly be classified into B2C and B2B segments:

i. B2C Segment (~92% of Market as of H1CY2025)

This segment is driven by household consumption, premiumization, and product replacement cycles, particularly across urban and semi-urban regions.
It includes products like refrigerators, washing machines, televisions, mobile phones, and smaller household appliances.
Design, functionality, and after-sales service play crucial roles in purchasing decisions.

ii. B2B Segment (~8% of Market as of H1CY2025)

Catering to commercial and institutional users, this segment includes commercial ACs, computing equipment, and specialized displays for offices, hospitals, and government facilities.
Buyers emphasize reliability, energy efficiency, and long-term cost savings, highlighting the need for tailored enterprise solutions.

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Distribution Network and Channel Performance

The market’s evolution is closely tied to shifting distribution patterns and consumer buying behaviors.

LGEIL operates India’s largest distribution network among home appliances and consumer electronics players as of June 30, 2025.

• Its LG BrandShops are 1.4x larger than the next leading player’s exclusive store network.

• Its distributor base is 1.2x larger than that of its nearest competitor.

• The company also has one of the largest after-sales service networks in India, ensuring superior reach and responsiveness.

Furthermore, in FY2025, 90% of deliveries to trade partners’ warehouses were completed within 6–7 days, compared to the industry average of 10–12 days—demonstrating LGEIL’s operational efficiency.

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India Appliances & Electronics Market by Channel (B2C excl. services)

CY2019 – CY2029P

1. Unorganized Trade (~38% share in H1CY2025):
   Comprising local dealers and small regional retailers, this general trade (GT) channel remains dominant in semi-urban and rural regions due to price sensitivity and accessibility. Despite modernization, it will retain a significant market share.

2. Organized Offline Channel (~21% share):
   Large-format retail stores (LFRs) and multi-brand outlets (MBOs) attract consumers with variety, hands-on experience, and expert advice. Growth in this channel is expected to accelerate in urban centers.

3. Organized Online Channel (~39% share):
   E-commerce has rapidly transformed the landscape, with growth driven by rising internet usage, convenience, and competitive pricing.
   Festive sales, exclusive online launches, and targeted offers continue to fuel online expansion.

4. Exclusive Brand Stores (~2% share):
   Brand-owned outlets (EBOs) maintain a stable market share, supporting brand visibility and consumer trust.

5. Omnichannel Strategies:
   Retailers are increasingly adopting hybrid models, integrating online and offline experiences. Click-and-collect options, personalized journeys, and seamless channel transitions are driving higher consumer engagement and brand loyalty.

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B2C Market Deep Dive

The B2C segment, representing the bulk of India’s appliance and electronics market, was valued at ₹6,330 billion (US$74 billion) in H1CY2025, up from ₹5,860 billion (US$69 billion) in CY2024, growing at a CAGR of ~7% from CY2019–CY2024.
It is expected to reach ₹9,990 billion (US$118 billion) by CY2029P, growing at ~11% CAGR.

When mobile phones are excluded, the segment stands at ₹2,955 billion (US$35 billion) as of H1CY2025, projected to reach ₹5,215 billion (US$61 billion) by CY2029P, at a ~14% CAGR.

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Key Drivers of B2C Growth

1. Rising Incomes & Premiumization:
   A growing middle class and rising disposable income are driving demand for premium appliances with advanced features, higher energy efficiency, and superior design.
   Consumers are increasingly opting for value-added services, such as subscription-based appliances and premium maintenance plans.
   However, price sensitivity among mid-income consumers remains a key adoption barrier.
   Between CY2019 and CY2024, consumer discretionary spending grew at 7–8% CAGR, with higher average selling prices (ASPs) and unit volumes for premium categories.

2. Urbanization & Nuclearization:
   Rapid urbanization, especially in Tier 1 and Tier 2+ cities, is expanding the consumer base and boosting demand for modern, tech-enabled appliances.
   The trend of nuclear families in urban areas further accelerates replacement cycles and preference for compact, efficient appliances.

3. Low Penetration Levels & Market Potential:
   India’s appliance penetration remains low compared to other G20 economies, presenting significant room for growth.
   Rising affordability, digital access, and innovative financing models (like EMI and rental options) are enabling broader adoption.
   As penetration deepens, India’s market is expected to mirror the growth trajectory of emerging economies such as China.

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Conclusion

The India Appliances & Electronics Market is on a strong upward trajectory, supported by favorable demographics, technological innovation, and structural retail transformation.
With the B2C segment driving over 90% of total value, and organized retail channels gaining momentum, the market offers significant opportunities for both domestic and global players aiming to capture India’s expanding consumer base.

BUSINESS STRENGTHS

1. Leading Market Share Across Home Appliances and Consumer Electronics in India
LG Electronics India has maintained the #1 market position in the home appliances and consumer electronics segment (excluding mobile phones) for the six months ended June 30, 2025, and during CY2024, CY2023, and CY2022, based on market share (in terms of value) in the offline channel, as reported by Redseer.
The company is also the market leader across key product categories, including washing machines, refrigerators, panel televisions, inverter air conditioners, and microwaves. The offline channel, representing approximately 78% and 77% of the Indian market (by value) for the twelve months ended December 31, 2024, and the six months ended June 30, 2025, respectively, remains a significant contributor to this leadership.
Additionally, LG Electronics India leads both the volume and premium segments across washing machines, panel televisions, and microwaves, underscoring its deep understanding of Indian consumer preferences and its ability to deliver products aligned with evolving market demands.

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2. Innovation-Driven Product Portfolio Tailored for Indian Consumers
With over 28 years of operational experience in India, the company has developed a strong understanding of local consumer behavior and regional market requirements. Leveraging the global technological expertise of LG Electronics, recognized as a pioneer of innovation by the Redseer Report, LG Electronics India has consistently introduced industry-first technologies in the Indian market.
Key milestones include the introduction of OLED televisions in 2015, and the launch of 4K and Smart TVs in 2011. As a result, OLED TV sales rose from 1% of total TV sales in CY2019 to 6% in the six months ended June 30, 2025, with a market share (by value) of 62.9% in the offline channel during the same period.
In 2017, LG Electronics India became the first player to transition fully to inverter air conditioner technology, and was also the first to introduce microwaves in 1999, according to the Redseer Report.
By CY2024, more than 80% of televisions sold in India featured 4K picture quality, and over 90% were Smart TVs, with LG commanding offline market shares of approximately 29.9% in 4K TVs and 27.9% in Smart TVs as of June 2025.

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3. Extensive Pan-India Distribution and After-Sales Network
The company operates the largest distribution network among major home appliance and consumer electronics players in India, with 35,640 B2C touchpoints as of June 30, 2025, as per the Redseer Report.
This network includes LG BrandShops, modern trade stores (such as Reliance Retail, Croma, and Vijay Sales), online marketplaces, traditional distributors, and regional sub-dealers.
An integrated omnichannel strategy enables consumers to engage both online and offline, ensuring a seamless and consistent brand experience. The LG BrandShop network is 1.4 times larger than the nearest competitor’s exclusive brand outlets, and its distributor base is 1.2 times greater than the next largest player.
Sales promoters stationed across retail touchpoints are trained to enhance consumer experience and drive cross-selling. This widespread infrastructure allows LG to adapt to regional demands, such as increasing the supply of hot/cold air conditioners in North India during winter months.

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4. Strong Manufacturing Capabilities and Localized Supply Chain
LG Electronics India operates two major manufacturing facilities located in Noida and Pune, representing over 85% of total sales in the three months ended June 30, 2025, and during Fiscals 2025, 2024, and 2023.
The company possesses one of the largest in-house production capacities in the industry, excluding mobile phones, as of June 30, 2025, according to the Redseer Report.
Key components—including compressors, motors, and control systems—are manufactured in-house, ensuring greater control over quality, product development timelines, and cost efficiency.
This localized supply chain approach enhances operational agility, reduces dependency on imports, and strengthens Make in India manufacturing initiatives, aligning with national priorities.

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5. Strong Global Parentage and Trusted Brand Legacy
LG Electronics, the leading single-brand global home appliances player by revenue in CY2024, provides technological, manufacturing, and brand support to its Indian subsidiary.
The LG brand, listed among Interbrand’s Top 100 Best Global Brands, enjoys exceptional consumer trust in India, validated by multiple recognitions, including:

• “Most Trusted Brand – Electronics Segment 2025” (Brand Empower Pvt. Ltd.)

• “India’s No.1 Inverter Air Conditioner Brand 2025” (Market Excel)

• “India’s No.1 Refrigerator Brand” and “Most Trusted Home Appliances Brand” (Intage India, February 2025)

• “Most Trusted Brand in Refrigerator, Microwave & Dishwasher 2025” (Trust Research Advisory)

The company’s strong digital presence, with over six million social media followers as of June 2025, further enhances consumer engagement and brand visibility across India.

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6. Capital-Efficient Growth with Industry-Leading Profitability
LG Electronics India demonstrates a capital-efficient business model characterized by high profitability, strong returns, and efficient working capital management.

• Return on Capital Employed (ROCE): 45.31% in Fiscal 2024 — the highest among leading players, compared to an industry average of ~17%.

• Net Working Capital Cycle: 15.95 days in Fiscal 2024, compared to the industry average of ~26 days.

• Free Cash Flow Conversion Ratio: 59.49% in Fiscal 2024, exceeding the industry average of 55.6%.

• EBITDA Margin: 10.42%

• Net Profit Margin: 7.01% — both significantly higher than industry averages of <7% and 4.5%, respectively.

These metrics reflect a robust financial foundation, operational efficiency, and disciplined capital allocation, positioning LG Electronics India as one of the most profitable players in the sector.

BUSINESS STRATEGIES

1. Building a Strong Foundation for Long-Term Growth in India
LG Electronics India aims to capitalize on the nation’s expanding middle class, rising preference for premium and technologically advanced products, and the rapid pace of urbanization and infrastructure development. According to the Redseer Report, the demand for home appliances and consumer electronics is projected to increase from approximately ₹6,875 billion in the six months ended June 30, 2025 (annualized), to around ₹10,965 billion by CY2029.
Leveraging its strong market standing, extensive pan-India network, trusted brand reputation, and high-quality products, the company is well-positioned to capture this growth. As market penetration continues to improve—mirroring trends seen in other emerging economies—LG Electronics India is expected to benefit from an expanding addressable market and sustained consumer demand.

2. Strengthening Brand Presence Across Volume and Premium Segments
The strategic vision focuses on making LG a brand of choice for every Indian household, spanning both volume-driven and premium categories. The company seeks to deliver durable, reliable, and user-friendly products tailored to regional consumer needs, enhancing brand loyalty through superior after-sales service.