LG India margin rebounds, but still trails sector median
The sequential recovery followed a weak Q3, while lower tax and other income also supported the sharp profit increase.
Filed 21 May 2026, 18:42 IST · after market close · LG Electronics India Ltd (LGEINDIA)
Key takeaways
- Standalone operating margin rebounded 6.97 percentage points sequentially to 11.74% as revenue grew 95.74% and expenses grew 81.41%.
- Standalone net profit rose 672.53% sequentially, helped by a 15.29-percentage-point fall in the tax rate and other income equal to 10.86% of pre-tax profit.
- Despite the rebound, LG India's 11.74% operating margin was 3.07 percentage points below the 14.81% median of 93 Consumer Discretionary peers.
Price around the results
Q4 operating leverage reversed the Q3 slowdown
LG Electronics India reported standalone revenue growth of 95.74% sequentially, while operating profit increased 382.11%, showing a much sharper recovery in profitability than in sales. Net profit rose 672.53% from Q3, although the comparison is against a weak quarter in which operating margin had fallen to 4.77%. The company said RAC sales crossed one million units in Q4, and that Information Display growth was supported by Commercial TV and Signage orders.
Costs helped margin, but profit quality needs separating
Expenses grew 81.41% sequentially against 95.74% revenue growth, allowing operating margin to expand by 6.97 percentage points to 11.74%. Interest expense rose 47.75%, while depreciation fell 8.22%, so the operating improvement was not fully reflected in the movement below operating profit. The 15.29-percentage-point decline in the tax rate and other income contributing 10.86% of pre-tax profit also lifted reported net profit.
Margin recovered from Q3 but remains below peers
The margin path was uneven: operating margin moved from 8.87% in Q2FY26 to 4.77% in Q3FY26 before recovering to 11.74% in Q4FY26. That is a sequential reversal rather than a continuing decline, but the Q4 margin remained 3.07 percentage points below the 14.81% median across 93 reported Consumer Discretionary peers.
Management points to exports, localisation and premium products
Management said the Sri City plant is scaling local manufacturing for domestic and export demand, while exports of the Essential Series and premium products could add to growth. The company told analysts that upcoming IPL and Football World Cup events could support near-term demand for large-screen and premium TVs, and said the B2B business has a healthy order pipeline. Management also said it remains focused on inflation and input costs while expecting margin improvement, and flagged upcoming electronic blackboard and second-generation Micro LED MAGNIT launches.
Initial market reaction was negative after the late filing
The standalone results were filed after market close on May 21. On the following session, the stock fell 2.59% and opened 2.95% lower, with traded volume at 2.4 times the reference level; its relative return was -2.87%. The initial decline moderated over time, with the stock up 0.58% after five sessions and 2.75% after 30 sessions.
Q4FY26 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ |
|---|---|---|---|
| Revenue | ₹8,054 cr | ₹4,114 cr | +95.74% |
| Other income | ₹101 cr | ₹76 cr | +33.60% |
| Expenses | ₹7,108 cr | ₹3,918 cr | +81.41% |
| Operating profit | ₹945 cr | ₹196 cr | +382.11% |
| Operating margin (%) | 11.74% | 4.77% | — |
| Interest | ₹14 cr | ₹9 cr | +47.75% |
| Depreciation | ₹102 cr | ₹111 cr | -8.22% |
| Profit before tax | ₹931 cr | ₹152 cr | +513.76% |
| Tax | ₹238 cr | ₹62 cr | +284.26% |
| Net profit | ₹693 cr | ₹90 cr | +672.53% |
| EPS (₹) | ₹10.21 | ₹1.32 | +673.48% |
Operating margin of 11.74% compares with a Consumer Discretionary sector median of 14.81% across 93 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -2.59% | -2.87% |
| Next session | +0.27% | — |
| 5 sessions | +0.58% | +1.73% |
| 15 sessions | -0.07% | — |
| 30 sessions | +2.75% | — |
Volume on the results session was 2.40× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- RAC sales reached a record milestone of more than one million units in Q4 FY26.
- Information Display recorded strong growth from order inflows in Commercial TV and Signage.
Guidance & outlook
- LG remains optimistic about margin improvement while focusing on inflation and input costs.
- Exports of Essential Series and premium products are expected to provide incremental growth.
- Upcoming IPL and Football World Cup events are expected to boost near-term demand for large-screen and premium TVs.
Expansion
- The Sri City plant is scaling localized manufacturing to serve domestic and export demand.
New orders
- LG's B2B business is supported by a healthy order pipeline.
New products
- LG is launching a new five-star SAC model for government project bidding and institutional business.
- LG plans to launch an electronic blackboard and second-generation Micro LED MAGNIT.
New initiatives
- LG plans electronic blackboard and second-generation Micro LED MAGNIT launches under Make in India.
Problems & risks
- Rainfall disruptions affected the market before demand improved in mid-April.
What to watch
- Whether standalone operating margin holds above the Q4FY26 level of 11.74%.
- Whether the 3.07-percentage-point gap to the 14.81% sector median narrows.
- Whether the tax rate remains near 25.59% and other income stays below its 10.86% share of pre-tax profit.