LG Electronics Is Latest to Test India’s Roaring IPO Market

The Indian unit of South Korea-based LG Electronics Inc. filed for an initial public offering, the latest among foreign companies looking to tap investors in the South Asian country’s booming market.

LG Electronics will sell as many as 101.82 million shares of the Indian unit in the IPO that is likely to be one of the biggest in Indian history. The sale will constitute 15% of the post-offer shares of the unit, according to a draft red herring prospectus filed with the market regulator. 

LG may seek to raise $1 billion to $1.5 billion from the share sale, likely giving LG Electronics India a valuation of about $13 billion, Bloomberg News reported in November. The filing comes on the heels of Hyundai Motor Corp.’s record $3.3 billion listing of its Indian unit in October. 

The deal would help cement the South Asian country as one of the busiest venues globally for first-time share sales this year. Over 300 companies have raised more than $15 billion from public listings so far in 2024, thanks to robust demand from retail investors and global funds. At least three IPOs, including Vishal Mega Mart Ltd., which aims to raise up to $944 million, have offers starting next week.

However, large IPOs have struggled to justify the hype around their shares sales. Hyundai Motor India’s shares dipped on debut, and remain about 5% below the IPO price. Other big offerings, including that of One 97 Communications Ltd. in 2021, have previously suffered a similar fate.

Still, international companies have seized on the strength of India’s stock markets this year to offload stakes in local subsidiaries. Other multinationals selling off some of their Indian holdings this year include British American Tobacco Plc, which raised $2 billion selling shares in its Indian partner, and Whirlpool Corp.