LG Electronics India’s initial public offering (IPO), which opened for subscription on Tuesday, October 7, was fully subscribed at the close of the first day of bidding.It received bids for a total of 7.44 crore shares of the 7.13 crore shares on offer.Subscription was led by Non institutional investors, who placed bids for 3.51 crore shares, more than the 1.52 crore on offer, taking the overall subscription past 2x on the first day.
The portion reserved for retail investors was subscribed 81%, while that reserved for Qualified Institutional Bidders was subscribed 49% on the first dayLG Electronics India shares were trading at a 29% premium in the unlisted market, according to Grey Market Premium reports. The GMP currently stands at ₹330 per share after bidding closed on the first day. It must be noted that these are only speculative reports and the original listing price may vary from these rates.The ₹11,607 crore initial public offering will close for subscription on October 9 and shares will list on the exchanges on October 14.
The issue is an entire offer for sale (OFS), with the parent company LG Electronics Inc selling stake. The India unit will not receive any proceeds from the issue. As many as 10.18 crore equity shares are on offer.The price band of ₹1,080 to ₹1,140 per share implies a market capitalisation of around $8.7 billion, or roughly ₹77,000 crore at the upper end.The company raised ₹3,474 crore from multiple anchor investors ahead of its IPO. Its board had approved the issue of 3.04 crore equity shares to eligible anchor investors at the upper end of the IPO price band of ₹1,140 per share.LG Electronics told CNBC-TV18 it is set to scale production, expand its B2B business and lead the premiumisation of consumer electronics in India.The company is also rolling out a third manufacturing plant in Sri City, Andhra Pradesh and introducing new products across tier 2 and 3 towns.”Our plan is that by the end of next year, near Diwali, we start production on our first line. There will be a phase-wise investment, and by 2029, we will complete the project. Notably, this plant is much bigger than our existing two plants—roughly three times bigger in size,” Sanjay Chitkara, Chief Sales Officer at LG Electronics India, told CNBC-TV18.LG Electronics is the third-largest IPO of India this year, following the currently open ₹15,500 crore issue of Tata Capital, and the ₹12,500 crore HDB Financial IPO earlier this year.It needs to be noted that the GMP reports are speculative and the actual listing price could differ from these rates.
