Why LG India is a Buy: Goldman Sachs Sees 15% Upside

Synopsis: Goldman Sachs launched coverage on LG Electronics India (NSE: LGEINDIA) on February 18, 2026, with a “Buy” rating and a target of ₹1,750. The “Zero-Minute” fact is that despite a 61.6% Q3 profit slump to ₹89.7 Crore, the brokerage projects a 22% EPS CAGR through FY28, driven by dominant premium market shares and its “Global South” export strategy.

On Wednesday, February 18, 2026, LG Electronics India Limited (LGEL) shares were in focus after Goldman Sachs initiated coverage with a bullish “Buy” rating. The global brokerage has set a 12-month price objective of ₹1,750, implying a 15% upside from current levels of approximately ₹1,550. While the stock faced recent pressure following its Q3 FY26 earnings, the brokerage views the current dip as a strategic entry point into India’s leading consumer durables player.

The initiation highlights LG’s 28-year market leadership. Goldman Sachs expects the Indian consumer durables sector to grow at a revenue CAGR of 10.2% over the next five years, with LG poised to outpace this growth due to its high exposure to the fast-growing “premium” and “masstige” categories.

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Why did Goldman Sachs initiate a “Buy” on LG Electronics?

The primary driver of the bullish thesis is Premiumization and Favorable Demographics. Goldman’s research indicates that India’s shifting income cohorts are moving toward high-end appliances faster than the broader market. LG, which holds a massive 62.4% market share in OLED TVs and a 43.3% share in Side-by-Side Refrigerators, is the primary beneficiary of this aspirational upgrade cycle.

Furthermore, the “1-2-1” rule of Goldman’s conviction was evident: one dominant parent strategy (Global South), two structural catalysts (rising urban penetration and GST benefits), and one massive export ambition. LG is investing ₹5,001 Crore in a third manufacturing facility at Sri City, Andhra Pradesh, slated for production by November 2026, which will serve as a global hub to double its export volume.

LG Electronics India: Financial Forecast & Market Share

Category / Metric	Market Share (Dec 2025)	Growth Outlook (FY26-28E)	Brokerage View
Washing Machines	33.0% (#1)	15% Revenue CAGR	Strong Leadership
OLED TVs	62.4% (#1)	Tech Superiority	Niche Dominance
Refrigerators	30.0% (#1)	Premium Mix Rising	High Margin Potential
EPS Forecast	–	22.0% CAGR	Post-FY26 Recovery

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Navigating Near-Term Margin Pressure

Despite the long-term “Buy” call, the brokerage acknowledged immediate operational hurdles that have weighed on the stock recently.

• Q3 Profit Slump: LG India reported a 61.6% YoY decline in net profit to ₹89.7 Crore for the quarter ended December 2025. This was attributed to soft post-festive demand and elevated commodity prices for copper and aluminum.
• EBITDA Compression: Margins narrowed to 4.8% from 7.8% a year ago. However, Goldman believes this is cyclical and expects a recovery as LG’s localisation rate rises from 54% toward its 70% target.
• Valuation Support: The brokerage values the stock at 44x FY28E EPS. While the P/E appears elevated compared to the industry average of 41x, LG’s 45% Return on Equity (ROE) justifies the premium.

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The Bottom Line

The ₹1,750 target from Goldman Sachs signals that LG Electronics India remains a “compounding machine” despite short-term earnings volatility. For the Aam Aadmi investor, the focus remains on the summer 2026 demand cycle for ACs and the upcoming Sri City facility rollout. If LG can successfully pass on raw material hikes through its premium portfolio, the 15% upside could be reached well before the fiscal year-end.

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