Becoming the second South Korean firm to list in India, LG Electronics India secures SEBI approval for a ₹150 billion IPO, with funds directed to its parent company.
LG Electronics India Ltd, a subsidiary of the South Korean chaebol LG, have received SEBI’s approval to raise funds through initial public offerings (IPOs), an update with the capital markets regulator showed on Tuesday.
According to the Economic Times, LG Electronics India filed draft IPO papers with SEBI in December and obtained the regulator’s observations on March 13 and March 12, respectively. In SEBI’s parlance, obtaining the observations means its go-ahead to float the public issue.
LG Electronics India has plans for a public offering in which the parent company will sell over 10.18 crore shares, representing a 15 per cent stake, as outlined in the draft red herring prospectus (DRHP). While the company has not revealed the exact size of the issue, reports have estimated the IPO to be worth approximately ₹150 billion.
Notably, this IPO will be entirely an offer for sale (OFS), meaning LG Electronics India will not directly benefit from the proceeds. Instead, the funds raised will be directed to the South Korean parent company.
This move will make LG Electronics India the second South Korean firm to enter the Indian stock market, following Hyundai Motors India’s listing in October last year.
In preparation for the IPO, LG Electronics India has already commenced roadshows. The company is known for manufacturing and selling a variety of products, including washing machines, refrigerators, LED TV panels, air conditioners, and microwaves. Its manufacturing facilities are located in Noida (Uttar Pradesh) and Pune.
On a different note, SEBI returned the draft IPO documents of Neilsoft, a technology-driven engineering services company, on March 10, without offering an explanation.
