LG Electronics India Q1 profit rose 27%, while revenue grew 15.5% year-on-year.
EBITDA margin improved to 12.5%, driven by premiumisation and operating leverage.
CLSA and Jefferies remained bullish, citing strong margins and broad-based growth.
LG Electronics India Shares Jump 8% As Strong Q1 Earnings Trigger Brokerage Upgrades
Q1 profit jumped 27%, EBITDA margin improved to 12.5%, while CLSA and Jefferies highlighted premiumisation and broad-based growth
LG Electronics India Shares Jump 8% As Strong Q1 Earnings Trigger Brokerage Upgrades
Summary
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Shares of LG Electronics India surged over 8% on Friday, emerging among the top midcap gainers after the company reported strong June-quarter earnings, prompting positive commentary from brokerages.
The stock rose as much as 8.1% to ₹1,714 on the NSE, taking its gains for the year to 14.5%. The company's market capitalisation stood at around ₹1.15 lakh crore.
The rally followed the company's Q1 FY27 results announced on Thursday. LG Electronics India reported a 27.2% year-on-year rise in net profit to ₹653 crore from ₹513.2 crore a year earlier. Revenue from operations increased 15.5% to ₹7,233.3 crore, while EBITDA grew 26.2% to ₹904.2 crore. EBITDA margin expanded to 12.5% from 11.4% in the corresponding quarter last year.
Brokerages See Further Upside
CLSA maintained its 'Outperform' rating on the stock with a target price of ₹1,885 per share, implying more than 19% upside from Thursday's closing price.
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The brokerage said the earnings beat was driven primarily by stronger margins in the home entertainment business and an improving premium product mix. It added that growth was broad-based across appliances, entertainment products, price segments and exports. CLSA also highlighted the company's FY27 guidance of mid-teen revenue growth and an early double-digit EBITDA margin.
Jefferies retained its 'Buy' rating with a target price of ₹1,815 per share, saying profit growth exceeded expectations due to stronger-than-anticipated margins.
According to Jefferies, margin expansion was supported by premiumisation, operating leverage, selective price hikes and cost-control measures. The brokerage also pointed to higher localisation and backward integration in compressor manufacturing as additional positives.
Jefferies further noted that the company's LG Essential Series is seeing increasing penetration in tier-2 and tier-3 markets, reflecting its strategy to expand beyond premium offerings and deepen its reach across India.