According to informed sources, LG Electronics Inc. plans to resume the initial public offering (IPO) of its Indian division in September. The IPO of LG Electronics India Ltd. was expected to raise up to $ 1.7 billion, making it one of the largest placements in India.
The South Korean company intends to resubmit the preliminary prospectus with updated financial results after the summer, and the placement itself may take place as early as in the fourth quarter of this year. This was reported by sources who wished to remain anonymous, as the information is not public.
As previously reported by Bloomberg News, LG Electronics suspended its IPO preparations in April, partly due to market volatility. The company later said it would decide on further steps depending on market conditions. According to sources, discussions are ongoing, and LG Electronics may again postpone the IPO. A company spokesperson declined to comment.
Earlier, investors expressed disagreement with the valuation of the parent company, according to people familiar with the matter. Last month, LG Electronics India announced plans to invest about $ 600 million over four years to build a new factory — the country's third — in the southeastern state of Andhra Pradesh.
After a downturn in the first quarter, activity in the Indian initial public offering market recovered on the back of a rising stock market: the key NSE Nifty 50 index rose by about 12% from its March low. While most of the activity came from large deals and subsequent stock placements, bankers expect this momentum to lead to an increase in the number of IPOs in the second half of the year, including several placements worth more than a billion dollars.
