LG Electronics India Q2 net up 25.7% on balanced volume and value growth

LG Electronics India posted a net profit of ₹489.3 crore in September quarter up 25.7 per cent over ₹389.4 crore in the year-ago period despite commodity pressures and rupee depreciation. Revenue from operations grew 19.5 per cent to ₹7,380 crore on the back of balanced growth in terms of both volume and value.

Hong Ju Jeon, Managing Director, LGE India said, “This performance reflects the broader strength of India’s consumer durables industry, which continues to benefit from rising disposable incomes, growing aspiration for premium products and deepening penetration across metro and emerging markets,” he added.

Sanjay Chitkara, Co-Chief Sales and Marketing Officer, LGE India told businessline, “ Home Appliances and air solution segment recorded a growth of 21 per cent, highest quarterly growth since our listing. Home Entertainment segment also delivered third consecutive quarter of double-digit growth at 17.2 per cent.”

“Our newly introduced QNED and OLED range helped us grow the 55-inch and above segment, which is now nearly 50 per cent of our TV revenues. Also, fully automatic washing machines are now contributing 60 per cent to our overall washing machines portfolio,” he added.

On the ongoing festival growth momentum, Chitkara said, “ Consumer sentiments are very positive despite prevailing global uncertainties. We are witnessing growth momentum building from Q2 onwards. Q2 was infact the most difficult quarter and despite that we have registered 20 per cent growth. This reflects LG’s brand strength and strong fundamentals of India’s consumption economy and we are confident of witnessing double-digit growth. Post Diwali, there is also the wedding season which augurs well for Q3.”

Chitkara pointed out the company’’s growth is not merely price-led but its coming from both mass and premium segments as segments such as 32-inch LED TVs and single door refrigerators has also been witnessing strong growth.

Responding to a query on the macro-economic challenges, Atul Khanna, Chief Accounting Officer, LGE India said, “The headwinds being faced by the industry are significant. Price of raw materials were moving up and down significantly but the demand momentum continues. In Q2, we have expanded our EBIDTA margins by 63 basis points to 9.3 per cent. So we are maintaing a balance of consumer demand momentum. We had hiked prices of AC by 5 per cent on October 1. On November 1, we have taken 3-5 per cent price hike for all our other appliances. So I believe we have already seen the worst in terms of pressures but remain watchful going forward.”

Meanwhile, the company is also marking its entry into a new B2B segment of in-vehicle infotainment including automotive infotainment and telematics solutions, to India. These products will be manufactured and supplied from LGE India’s 3rd plant at Sri City, Andhra Pradesh.

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