LG Electronics India Ltd Q4 FY26 Earnings Call: Guides Mid-Teen Revenue Growth, AC Volumes Cross 1 Million

LG Electronics India Ltd held its Q4 FY26 earnings call on May 21, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record Quarterly Revenue Despite Macro Headwinds

• Q4 FY 2025-2026 revenue Rs.80.54 billion— a record quarterly level, up 8.1% YoY from Rs.74.48 billion in Q4 FY 2024-2025, despite delayed summer onset, US-Iran tensions, rupee depreciation, and rising raw material costs.
• Q4 EBITDA Rs.9.45 billion (margin 11.7%)— improved 7% sequentially; net profit Rs.6.93 billion (PAT margin 8.5%).
• Full-year FY 2025-2026 revenue Rs.246.05 billion— +1.0% YoY, with EBITDA of Rs.24.08 billion (margin 9.8%) and net profit of Rs.16.85 billion (PAT margin 6.8%).
• Home Appliance & Air Solution segment Q4 revenue Rs.65.16 billion— +5.7% YoY, +133.7% QoQ; full-year segment revenue Rs.181.60 billion; EBIT margin 11.9% impacted by commodity costs, rupee depreciation, and channel investments.
• Home Entertainment segment Q4 revenue Rs.15.37 billion— +19.6% YoY, +15.9% QoQ; full-year segment revenue Rs.64.44 billion; EBIT margin 13.4% impacted by Cricket World Cup marketing investments and rupee depreciation, partly offset by cost discipline and B2B contribution.
• Cash and bank balance Rs.44.76 billion— as of 31 March 2026, fully funding the Rs.50 billion Sri City plant investment through internal accruals; working capital at Rs.22.73 billion with normalised channel inventory post BE transition.

AC Volumes Cross 1 Million; Premium TV & Refrigerator Share Gains

• Record 1 million+ room AC units sold in Q4 FY 2025-2026— management cited low 13% penetration and GST cuts as demand catalysts; channel inventory entering Q1 FY 2026-2027 is at same level as last year with strong current sell-out due to high temperatures.
• French-door refrigerator market share rose from 5% to 14%— as of March 2026 (end of FY 2025-2026); management articulated ambition to become #1 in the segment.
• TV segment grew 20%+ in Q4 FY 2025-2026— 55-inch+ screen revenue grew 47%, now accounting for 49% of TV revenue; LG maintained 60.0% OLED TV market share as of 31 March 2026.
• Essential series volumes in Q4 FY 2025-2026— ~1 lakh washing machines, 80,000 refrigerators, and ~20,000 room ACs (under 110 ton capacity) sold, primarily in smaller towns.
• Dishwasher now #2 player— management aims to become #1; new categories entered include chest freezers (market size ~Rs.3,000 crore), fixed-speed ACs, and large-size refrigerators (674L and 790L models produced in Pune).

Rs.5,000 Crore Sri City Plant On Track; Localization at 55.2%

• "X-CEL" growth strategy— built on four pillars: Export expansion, Capability of new factory production, Expansion of market leadership, and Localization.
• Localization rate reached 55.2% in FY 2025-2026— a 1.4 percentage point improvement YoY; management targets a 1–2 percentage point annual increase to reduce import dependency and currency exposure.
• Rs.50 billion (Rs.5,000 crore) Sri City factory on track— compressor production to start in Q3 FY 2026-2027, room AC production in Q4 FY 2026-2027, followed by washing machine and refrigerator lines; Rs.6.57 billion deployed as CWIP/advances by March 2026.
• Total capex commitment of Rs.5,000 crore— phased over several years, fully funded from internal accruals; FY 2025-2026 capex on existing facilities ~Rs.5.51 billion (2–2.5% of revenue).
• South India contributes 38–40% of total business— the Sri City plant will enhance logistics efficiency and support both localization and export ambitions.
• Exports of large-capacity refrigerators and SSS series— commenced in Q1 FY 2026-2027 to advanced markets and neighbouring countries respectively; management guided to double exports in FY 2026-2027 vs FY 2025-2026.

Q4 Margin Compression of ~250 bps; Recovery to Early Double-Digit Guided for FY27

• Q4 FY 2025-2026 EBITDA margin declined ~250 bps YoY— channel promotion investments (impact ~1.1%), rupee depreciation of 5.6% YoY (impact ~1%), and higher e-waste compliance costs from recycling targets rising from 60% to 70% (impact ~0.2%).
• Management guided to recovery of early double-digit EBITDA margins— for full-year FY 2026-2027, supported by price hikes, rationalizing promotional intensity, and a strong summer season.
• AC price hikes taken in two phases— first driven by new star-rating norms, second to protect margins from input cost and currency moves; similar adjustments for refrigerators and washing machines;no immediate plans for further increases, but management monitors raw material and currency conditions.
• Three structural levers to sustain margins— (i) scaling premium product portfolio (higher ASPs and margins), (ii) deepening localization (currently 55.2%), and (iii) expanding higher-margin AMC and B2B revenue share.
• Medium-term margin outlook— management stated it "hinges on stabilization of geopolitical conditions (lower oil/raw material costs) and resultant capital inflows into India" which could drive consumer demand recovery.

Mid-Teen Revenue Growth; Early-Teen Margins; Exports to Double

• FY 2026-2027 revenue guidance: mid-teen growth— management targets mid-to-high single digit to mid-teen growth across all four categories, with improved early-teen EBITDA margins driven by localization, operating leverage, richer mix, scaling of AMC/B2B revenues, and industry price increases.
• Q1 FY 2026-2027 early sell-through data encouraging— channel inventory lean ahead of peak summer season; B2B order pipeline healthy; new 5-star system AC model launched for government and institutional bids.
• Exports guided to double in FY 2026-2027 vs FY 2025-2026— portfolio shift toward premium products (side-by-side refrigerators, 790L+ top freezers, front-load washing machines) for developed markets and LG Essential series for developing regions; exports to 22 countries commenced.
• Essential series expansion underway— launched in October 2025 after visiting 1,200 Indian households in Tier 2/3 towns; will be extended into additional capacities, variants, colours, and televisions.
• Risks to watch— management remains "watchful of currency depreciation and geopolitical risks" (segment 6); return ratios moderated in FY 2025-2026 due to high cash reserves and first-half headwinds, with improvement expected in FY 2026-2027 as capital is deployed and profitability normalises.