The country’s largest full-service brokerage house, Motilal Oswal, has retained its ‘Buy’ rating on LG Electronics. It sees more than 18% upside in the stock over the next 12 months, at a target price of Rs 1,860.
The analysts at Motilal Oswal visited the company’s plant in Pune and interacted with the management. They indicated that LPG availability remains largely secure, with alternate fuels ensuring minimal disruption. There’s a positive outlook for summer as demand trends remain strong with healthy January–March 2026 growth. This is supported by a pickup in secondary sales from April 2026.
LPG shortage impact
However, the RAC (Residential Air Conditioner) production is covered till March 2026, while refrigerator production is covered till early April 2026. The company is also shifting to PNG and acetylene, while 30% of LPG requirements can be shifted to diesel. Washing machine and TV production remain unaffected. The brokerage said that there is no major production disruption expected, with overall utilisation likely to remain at 80%.
RAC pricing & margins
However, the shortage of LPG and other raw materials is building up cost pressures, which are visible and continue to fluctuate frequently. The company hiked prices by 7%–10% in January 2026, with scope for further increases depending on raw material cost inflation.
It is also working to contract directly with resin suppliers, bypassing intermediaries to improve procurement efficiency. Margins are likely to be supported by carefully adjusted pricing strategies and a steady transition towards a higher-end product selection.
Demand trends
The company reported strong January–February 2026 growth across product categories. RAC sales grew during these two months despite a strong base, and March also remains strong as of now. However, the summer season was delayed in the Southern region, with recent showers in a few parts of the country.
Target to double exports in FY27
The company plans to increase its export to 12% of revenues in FY27, compared to 6% in FY26. This growth will be driven by side-by-side refrigerators and front-load washing machines.
LG Electronics share price performance
The electronics appliance stock has risen 4.5% in the last five trading days. It has fallen 4.6% in the past one month. It has raised investors’ wealth by almost 50% in the last six months and over 42% over the previous one year.
JM Financial on LG Electronics: Enough LPG till April
Another brokerage house, JM Financial, raised the target price on LG Electronics to Rs 1,770 from Rs 1,700, an upside of 15.2%. The brokerage firm said that the company’s existing inventory is sufficient to support refrigerators (till April first week) and RACs (till the end of March 2026). LPG is used in the production of refrigerators and ACs for brazing. However, the company is evaluating alternatives, including using PNG (reallocating current use) or acetylene (3-4x costlier versus LPG) to mitigate any constraints.
Overall, LG Electronics’ management remains optimistic about a strong summer season and expects growth to exceed last year’s level, provided there are no supply chain disruptions.