LG Electronics India shares tumble over 8% after weak Q3

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LG Electronics India shares fell sharply by 8.34 per cent in early trade on Thursday after the company reported a steep decline in December quarter earnings, with margins coming under pressure amid subdued post-festive demand and higher input costs.

The stock dropped over 8 per cent to ₹1,392 in early deal compared with the previous close of ₹1,518.80.

During the afternoon session, the stock staged a rebound from the day’s low, trading 3 per cent lower at 1,470.90 at 12.25 pm on the NSE.

The consumer durables major posted a net profit of ₹89.6 crore in the December quarter, down 61.5 per cent from ₹233.4 crore in the corresponding period last fiscal. Revenue from operations declined 6.4 per cent year-on-year to ₹4,114.3 crore, reflecting lower-than-expected post-festival demand and muted consumer offtake.

Brokerages said the quarterly performance was weaker than anticipated, largely due to seasonal factors and margin pressures.

ICICI Securities said LG’s Q3FY26 print was impacted by post-festive seasonality and weaker trade and consumer offtake. The brokerage noted that the company consciously avoided price discounting to protect its brand positioning, which weighed on margins.

It added that higher commodity inflation and currency depreciation further hurt profitability during the quarter.

Despite the weak showing, ICICI Securities maintained a constructive stance on the stock. The brokerage highlighted that LG continues to hold leadership positions in key categories, supported by strong brand equity, premium positioning and an extensive distribution network. It also pointed to gains in offline TV market share and strengthening leadership in the segment.

The upcoming Sri City plant, slated to be operational by Q3FY27, is expected to enhance supply chain efficiency by enabling faster market access and improving product availability, according to the brokerage. ICICI Securities also underscored LG’s focus on scaling up its AMC business and strengthening its B2B segment.

The brokerage believes LG’s dual strategy of supporting margins through premiumisation while driving volumes through its Essential series provides growth visibility. With easing US tariffs, it expects margins in the information display segment to improve over the medium term.

Calling the weak Q3FY26 performance transitory rather than structural, ICICI Securities retained its buy rating on the stock with a revised target price of ₹1,746, down from ₹1,875 earlier.

Investors will now watch for a recovery in demand trends and margin normalisation in the coming quarters as the company navigates cost pressures and consumer sentiment.