LG Electronics India shares list at a 50% premium compared to its issue price

After a blockbuster subscription to its initial public offering (IPO), shares of LG Electronics India are set to make their stock market debut on Tuesday, October 14.

The stock is expected to see strong listing gains, according to trends in the grey market premium (GMP) and analyst projections.

Prashanth Tapse of Mehta Equities expects listing gains of 25-30% or more, supported by robust investor sentiment and the company's fundamentally sound business model. He recommends that allotted investors 'hold' the stock for the long term, citing LG's dominant market position, diversified product portfolio, and steady growth outlook, while cautioning about possible short-term volatility.

For non-allotted investors, Tapse suggests adopting a 'wait and watch' approach, monitoring post-listing price movements and considering accumulation on meaningful dips.

In the unlisted market, LG's grey market premium stood at ₹430 today, indicating a 37.7% premium to the IPO price of ₹1,140. The premium has risen sharply from ₹370 on Monday, indicating strong demand ahead of listing.

The IPO, open for subscription between October 7 and 9, became the most subscribed public issue in Indian history, receiving bids worth nearly ₹4.5 lakh crore, surpassing the previous record of ₹3.2 lakh crore held by Bajaj Housing Finance.

The issue was subscribed 54 times overall, led by institutional investors, who bid for more than 160 times the shares on offer. Both the non-institutional and retail categories also saw robust participation.

The company had earlier raised ₹3,475 crore from anchor investors. The IPO was priced in the range of ₹1,080-₹1,140 per share.

The entire issue was an offer for sale (OFS), with the parent company LG Electronics Inc. divesting part of its stake. The Indian unit will not receive any proceeds from the issue.

With this listing, LG Electronics India becomes the second South Korean firm to tap the Indian capital market after Hyundai Motor India Ltd, which made its debut in October last year.

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