LG Electronics India Q2 FY27 Earnings Call: Rs. 50 Billion Capex Doubles Capacity, Highest Growth Quarter Since Listing (LGEINDIA)

LG Electronics India Ltd held its Q2 FY27 earnings call on November 05, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Highest-Growth Quarter Since Listing

• Revenue of Rs.73.8 billion, +19.5% YoY — Q2 FY 2026-2027 was the second consecutive quarter of double-digit growth and the highest-growth quarter since listing, with every key category growing in high-teens double digits.
• EBITDA up 28% YoY to Rs.7.01 billion — margin expanded 63 bps to 9.5%; PAT rose 25.7% to Rs.4.89 billion in Q2 FY 2026-2027.
• H1 FY 2026-2027 revenue of Rs.146.13 billion (+17.5%) — EBITDA of Rs.16.16 billion (+27.9%, margin 11.1%) and PAT of Rs.11.42 billion (+26.5%); management cited double-digit growth and profitability despite industry-wide challenges.
• Cash and bank balance of Rs.50.51 billion as of September 2026 vs Rs.57.07 billion at the start of the quarter — a Rs.6.56 billion working-capital build for festive/wedding-season channel stocking, which management views as positioning for strong Q3 FY 2026-2027 sell-through.
• Capex of Rs.8.7 billion in Q2 FY 2026-2027 vs Rs.2.3 billion in Q2 FY 2025-2026, driven by the Sri City, Andhra Pradesh facility, progressing in line with internal targets.
• Margin expansion was achieved despite elevated commodity prices, forex fluctuation headwinds, and festive go-to-market investments — offset by operating leverage on healthy volumes and a richer premium mix across both segments.

Both Segments Deliver Record Growth

• Home Appliance & Air Solution revenue of Rs.47.72 billion, +20.9% YoY — the highest quarterly growth since listing; washing machines, refrigerators and room ACs all grew double digits, with dishwashers delivering a breakout quarter.
• HA EBIT grew 28.4% to Rs.4.16 billion — margin at 8.7% vs 8.2% YoY; management took category-by-category price actions (not across-the-board hikes), moved early ahead of the industry, and let premium carry more of the inflation burden while protecting the mass segment.
• Home Entertainment revenue up 17.2% YoY to Rs.26.08 billion — third consecutive quarter of double-digit growth on a high base; offline value market share and TV market share at record highs.
• HE EBIT grew 19.9% to Rs.3.37 billion — margin 12.9% vs 12.6% YoY, driven by volume-led operating leverage and richer large-screen mix; B2B information display is now a second profit engine with a steadier margin profile.
• Washing machines posted their highest growth in eight quarters — fully automatic machines now exceed 60% of overall washing machine sales as the upgrade cycle accelerates; premium multi-door refrigerators (side-by-side, French door) grew more than 50% in Q2 FY 2026-2027.
• 55-inch-and-above TVs contribute more than half of TV revenue — the newly introduced QNED range is driving this segment, while the 32-inch mass segment is also picking up; RAC sales came in better than Q1 despite being off-season, aided by elevated temperatures across many parts of India.

Third Plant Doubles Capacity, Compressors From Q3

• Compressor commercial production at Sri City begins in Q3 FY 2026-2027 — Atul Khanna (Chief Accounting Officer) confirmed air conditioner manufacturing follows in Q4 FY 2026-2027 (around January 2027), with both lines fully operational by end of FY 2026-2027.
• Committed investment of Rs.50 billion over the next few years — the Sri City facility will become the company's third and most advanced manufacturing base, double existing production capacity, and serve as a dedicated hub for domestic and export markets.
• Additional compressor capacity of 2 million units once fully operational by end of FY 2026-2027 — the company currently sources part of its compressors from outside LG, exposing it to supply chain risk and forex headwinds; local production is expected to reduce costs significantly, with savings flowing into margins as volumes ramp.
• Management called Sri City "not just a cost story" — it supports export ambitions, and strong domestic manufacturing of the Essential series and premium products provides an edge on cost and supply reliability.
• Construction is progressing at record speed — management noted the pace has impressed even the state government; the plant will support a new AI air conditioner range with in-house compressors.

Make India Global: 68 Countries and a B2B Entry

• Export presence expanded from 50 to 68 countries in FY 2026-2027 — Export Head Jongwon Byun reported the distribution network grew from 112 to 151 partners, and the Essential Series is now available in 21 countries since launch, with plans to expand to more.
• Management expects significant year-on-year export growth in FY 2026-2027 — export revenue growth is expected to strengthen domestic competitiveness, improve profitability, and help manage foreign exchange risks; management acknowledged the export business is "not immune" to geopolitical uncertainties, though geographic diversification limits over-dependence on any single country or region.
• Entry into vehicle solutions announced — automotive infotainment and telematics products, one of LG Electronics' key global B2B businesses, to be manufactured and supplied from the new third Sri City plant; CFO Dong Myung So said the business will grow in phases, starting with telematics and gradually expanding into other vehicle solutions for the Indian market.
• LG (Korea HQ) is a global leader in in-vehicle infotainment and EV components — management said bringing these capabilities to India is a natural next step and called the VS entry "only the beginning"; the home appliance business remains the core growth engine, with VS as an additional long-term pillar.
• Entered 20+ new export countries since listing — the Essential range plus large refrigerators and washing machines are scaling in exports, becoming a second demand lever for the HA segment.
• No specific Q2 FY 2026-2027 export contribution figure or quantified FY27 export revenue level was provided in response to the analyst's question.

B2B Share Target and Selective Price Actions

• B2B contributes ~10-12% of total revenue as of Q2 FY 2026-2027 — management's goal is to meaningfully grow this share over the next 3 years, with 15%+ described as a realistic and achievable target given the pipeline across commercial, government, and infrastructure segments.
• B2B ambition of 20%+ growth over the long run (period unspecified) — Aditya Bhasin (Head – IR) reiterated B2B as one of the most important growth engines for LG India over the next several years; institutional displays (led by commercial TV) and system AC in large commercial projects are the strongest-performing sub-segments.
• Government projects are becoming an increasingly important part of the B2B business — spanning public infrastructure, smart city initiatives, and government buildings.
• Two rounds of selective price increases taken in FY 2026-2027 — Gurpinderjeet Singh (Head Financial Planning) cited rising steel, aluminum, copper and resin costs and exchange-rate pressure; the first approach is absorbing costs via efficiency, higher localization, and supplier negotiation rather than direct pass-through.
• No major demand slowdown observed after the price hikes — all major product categories delivered double-digit growth in Q2 FY 2026-2027 on both volume and value; management will take further adjustments, if needed, "carefully and responsibly."
• Data centers: no order wins disclosed — management is watching the space closely and has product capability in chillers and cooling solutions, but said it is too early to share more, viewing it as an interesting long-term opportunity.

Guidance Reaffirmed; Three-Pillar Plan to FY30

• FY 2026-2027 guidance reaffirmed at mid-teen revenue growth and early double-digit EBITDA margin — management stated its endeavor is to perform better than the stated guidance and the industry.
• Management believes H2 FY 2026-2027 will be better than H1 FY 2026-2027 — Co-CSMO Sanjay Chitkara said the demand picture across all categories is encouraging heading into Q3-Q4 FY 2026-2027; Q4 FY 2026-2027 is LG's biggest RAC sales period at roughly 55% of yearly sales, and management believes current momentum will continue.
• HA Q3 FY 2026-2027 outlook — the segment enters the festive quarter with lean, healthy channel inventory; premium categories (French door/side-by-side refrigerators, 8kg+ washing machines, dishwashers) expected to sustain momentum.
• HE Q3 FY 2026-2027 outlook — festive and wedding season expected to be the single biggest category driver, supporting healthy value growth across the industry (not just for LG); B2B information display order pipeline healthy with steady institutional demand expected through the quarter.
• Three-pillar transformation mapped to FY30 — IRO Sunju Soh told HSBC's Vishal Goel the plan spans exports, premiumization, and new businesses drawing on LG Korea HQ's global technology portfolio; management stated that by FY30, LG Electronics India will be a fundamentally stronger company.
• CFO Dong Myung So gave no specific margin guidance — but expressed confidence in long-term profitability, citing localization, premiumization, and earnings quality; the stated focus is on building a structurally stronger business rather than simply expanding margins.
• Management cited India's vision to become a global manufacturing hub — per the call, "India's vision to become a global manufacturing hub that makes products for the world," which LG Electronics India will support by working closely with the Indian government.