LG Electronics India Q2 FY2025-26 Financial Report: Revenue Holds Steady, Profit Pressured by Costs & GST Timing

LG Electronics India has released its Q2 FY2025-26 results, revealing a quarter of steady revenue but weakened profitability. For the three months ending September 2025, the company reported ₹6,174 crore in revenue, showing flat YoY performance, while net profit slipped 27% to ₹389 crore due to a mix of higher operational costs and temporary demand disruptions.

Despite the pressure on margins, the company maintained its strong market presence in high-growth categories like televisions, air conditioners and premium home appliances. Management expects a rebound in Q3 on the back of GST rationalisation, festive demand and improved product mix.

In this comprehensive 1000+ word article, we break down LG Electronics India’s Q2 FY26 performance, management commentary, cost pressures, market trends, and provide a comparative table with Q1 FY26 and Q2 FY25.

🌟 Key Highlights of LG Electronics India Q2 FY2025-26

• Revenue: ₹6,174 crore (+1% YoY)

• Net Profit: ₹389 crore (-27% YoY)

• EBITDA: ~₹547 crore (margin ~8.9%)

• Q1 FY26 PAT: ₹513 crore (sequential decline)

• Margin pressure due to higher input & logistics costs

• Short-term demand slowdown due to GST rate cuts

• Market share gains in TVs and air conditioners

• Festive season expected to revive demand

This quarter reflects a business navigating temporary headwinds while retaining strong fundamentals.

🔍 Detailed Breakdown of Q2 FY2025-26 Performance

1. Revenue Holds Steady Despite Market Uncertainty

LG Electronics India posted ₹6,174 crore in revenue, almost unchanged versus last year. While this may appear flat, it actually represents a resilient performance in a quarter disrupted by:

• Customer postponement of appliance purchases ahead of GST rate cuts

• Global supply chain pressures

• Rising input costs

• Increased competitive intensity in the Indian consumer electronics sector

The stable revenue indicates that LG’s distribution reach, channel partnerships and brand positioning remain strong.

2. Net Profit Falls 27% — Why?

Net profit dropped to ₹389 crore, down from ₹536 crore YoY.

🔸 Primary reasons for profit decline

• Higher component and freight costs

• Increased marketing and promotional expenses

• Lower demand in August–September due to customers delaying purchases until GST cuts became effective

• Changes in product mix, with more value segment demand

• Higher operational overheads due to new product launches

This profit decline is short-term and more external than structural.

3. EBITDA Margin Compression

LG India’s EBITDA reported at ~₹547–548 crore, resulting in a margin of around 8.9%.

Margins fell YoY due to:

• Raw material inflation (panels, compressors, semiconductors)

• Promotional activities to maintain market share

• Logistics cost increases

• Festive inventory buildup ahead of Q3

Despite this compression, LG continues to maintain one of the highest operating efficiency benchmarks among consumer durable companies.

📉 4. Impact of GST Rationalisation

One of the biggest temporary disruptions this quarter was due to GST rate cuts on several appliance categories.

📌 How GST changes affected Q2 performance:

• Consumers delayed purchases until the new lower GST applied

• Retailers reduced orders in anticipation of lower post-GST pricing

• Inventory realignment occurred across distribution chains

Management expects this deferment to reverse in Q3, which includes India’s festive season — a peak sales period.

📦 5. Segment-Wise Performance

Televisions (TVs)

LG continued to strengthen its No.1 position in the premium TV segment.
Demand was stable but price promotions affected margins slightly.

Air Conditioners (ACs)

AC sales grew YoY due to:

• Higher demand for inverter ACs

• Energy-efficient models gaining traction

• Improved channel penetration in Rajasthan, UP and South India

Refrigerators

Moderate growth as consumers postponed big-ticket purchases ahead of GST changes.

Washing Machines

Stable volumes, especially in front-load and inverter segments.

🔧 6. Cost Pressures Continue to Test Margins

Like most consumer electronics manufacturers, LG faced:

• Costlier imported components

• Higher logistics expenses

• Currency fluctuations affecting landed costs

• Elevated marketing spends to defend market share

Management has indicated it will continue working on:

• Vendor optimisation

• Regional sourcing

• Operational efficiencies

• Automation across manufacturing units

These efforts are expected to support margin recovery in the coming quarters.

📣 7. Management Guidance for FY2025-26

LG Electronics India remains positive about H2 FY26.

📌 Key guidance points:

• Expect improved demand in Q3 due to festive buying

• GST rationalisation to boost affordability in appliances

• Continued focus on premiumisation (OLED TVs, AI-enabled appliances)

• Better cost efficiencies through supply chain optimisation

• Reducing operational overheads post-festive quarter

• Improving channel inventory health

Management also highlighted that margin improvement will be a key priority.

🔮 8. Market Outlook & Growth Drivers

LG India is expected to benefit from:

• Rising consumer disposable income

• Urbanisation and premium product uptake

• Growing preference for smart home appliances

• Rapid adoption of energy-efficient appliances

• Strong offline + online distribution mix

The company’s focus on premium and inverter technologies could help lift margins as demand stabilises.

📊 Comparative Table: Q2 FY26 vs Q1 FY26 vs Q2 FY25

This table shows how Q2 FY26 was impacted mainly by timing and cost, not by structural decline.

📈 Investor Perspective

From an investment outlook, LG India displays:

• Strong revenue stability

• Temporary profit decline

• Expanding consumer base

• Hyper-competitive pricing

• Strong premium segment leadership

Investors will look closely at Q3 FY26 to confirm recovery in demand and margins.

🎯 Conclusion

LG Electronics India’s Q2 FY2025-26 performance reflects a company dealing with temporary disruptions rather than long-term challenges. Revenue stability shows strong brand strength, while profit contraction highlights near-term cost and GST-related pressures.

As GST stabilises, festive demand picks up, and premium appliances gain traction, LG Electronics India is well-positioned for a stronger second half of FY26.

The key message of this quarter is clear:
Sales held steady, margins dipped — recovery expected in Q3 and Q4.