LG Electronics India's profit falls as cost pressures squeeze (updated)

LG Electronics India

21/05/2026 14:59

Rewrites throughout with post earnings interview

By Urvi Dugar and Praveen Paramasivam

BENGALURU, May 21 (Reuters) - LG Electronics India LGEL.NS is targeting stronger revenue growth in fiscal 2027, buoyed by demand for premium appliances, while stepping up domestic production and sourcing to mitigate geopolitical and cost risks, executives told Reuters on Thursday.

Businesses are grappling with soaring energy prices, fractured supply ‌chains and trade routes severed by Iran's chokehold on the Strait of Hormuz, with the war already saddling companies with a bill of at least $25 billion.

"Prolonged geopolitical uncertainties can have some indirect impact on commodity prices, currency movements and a little bit consumer sentiment," said Sanjay Chitkara, co-chief sales and marketing officer at LG Electronics India.

"LG Electronics is completely focusing on localisation."

The company, which makes about 95% of its products in the country with 56% of its raw materials sourced locally, is also ramping up in-house production of air-conditioner compressors to reduce dependence on imports.

HIGHER REVENUE GROWTH, EXPORT PUSH

LG Electronics India expects fiscal 2027 revenue growth in the mid-teen percentage range, after reporting a 1% rise in the previous year, betting on demand for larger televisions, front-load washing machines and high-capacity refrigerators.

The Indian unit of South Korea's LG Electronics 066570.KS is ramping up exports, aiming to lift their contribution to overall revenue from 6% by venturing into newer product categories and expanding footprint across more markets.

The appliance maker expects to introduce chest freezers, top-opening deep freezers used for bulk storage, in the next two to three months.

For the March quarter, however, higher commodity prices and a weak rupee caused earnings before interest, taxes, depreciation and amortization to fall to 9.45 billion rupees ($98.23 million), from 10.48 billion rupees a year earlier.

Profit dropped 8%, while AC and home appliances demand powered 8% growth in overall revenue.

($1 = 96.2000 Indian rupees)

 (Reporting by Urvi Dugar and Praveen Paramasivam in Bengaluru, Additional reporting by Surbhi Mirsa; Editing by Janane Venkatraman and Shilpi Majumdar)

 ((UrviManoj.Dugar@thomsonreuters.com; +91 9558725583;))