LG Electronics India expects around 10 per cent growth in FY24 and exploring new business categories here besides investing further in its manufacturing ecosystem, said its Managing Director Hong Ju Jeon on Wednesday.
India is an important market for the South Korean chaebol, where it sees a "big potential" as the economic situation is bright compared to other global markets with a growing population with more youths, he said.
The company is working towards increasing the domestic value addition of India-made products and is even inviting its sister concerns from South Korea to set up plants for component manufacturing here, Jeon told PTI in an interaction here.
It is also looking to increase exports to other countries from India by enhancing the cost competitiveness and more products in its offerings.
"We will support the India government's make-in-India initiatives and will increase the exports from here and contribute to the Indian Economy," said Jeon.
Jeon also lauded India's growth story this year and said its economy is growing despite other markets facing tough times on account of global disruption from war and other factors.
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When asked about the growth expectation of LG business in India, he said: "LG also has the same expectation. Even the business in other countries will reduce compared to the rest of the year, but we (LG Electronics India) will grow."
LG Electronics expects to grow in double digits, higher than the GDP numbers.
"We would grow around 10 per cent and gain more market share," Jeon said adding that the growth would be secular and come from across the categories in which it operates here.
India is the second largest market for LG Electronics globally after the US and the South Korean chaebol expects to retain its growth momentum here.
Over the investment, Jeon said:" Our company is thinking in the long term. We are checking what kind of investment is required. Also product wise new we are studying for new businesses."
Presently LG has two manufacturing units at Ranjangaon, Pune and Greater Noida.
The company has recently invested around Rs 200 crore in a new line for manufacturing the premium range of side-by-side refrigerators at the Ranjangaon facility and Rs 100 crore in Noida to start local manufacturing of Dual Inverter Air Conditioner Compressors.
On being asked whether LG would set up another unit in India, Jeon said: "We need more capacity for the future. We do not know where it will be but we will but of course have new factories."
LG Electronics India is a wholly-owned subsidiary of South Korea-based LG Electronics. It is a formidable brand in India, operating in various segments, such as consumer electronics, home appliances, HVAC and IT hardware.
"The population of India is growing with a high number of young population," he said adding" Our internal management (LG Global) is very interested in the India market."
It is also working on India-centric products, in segments such as air-conditioners, making them more affordable.
Regarding LG Electronics India's export, Jeon said its still in single digits but it will grow. Increasing the exports, it requires more localisation and more products.
However, he also added that LG Electronics has several factories globally, which compete with each other. To increase the export, cost competitiveness from India-made products would have to be enhanced.
"On cost front, we need more efforts in terms of localisation and more products for exports," he said adding it not easy "but its very clear that we want to increase exports from here. We need to increase the volume, then cost of production would be down."
This can also benefit Indian consumers also.
Regarding the sourcing of components, Jeon said in localisation rate is high in India but added still the industry needs more support from the Indian government.
"When (global) suppliers want to invest in India, it should also support them for stable operation. Company as LG Chemical also started to manufacture to support the local production," said Jeon "We will invite more foreign countries to invest here."
Over the Production Linked Incentive Scheme (PLI) scheme floated by the Indian government, Jeon said: "We have invited our sister companies. Those companies which were sub-contractor in Korea and they are also coming to supply us here."
For the financial year that ended on March 31, 2022, LG Electronic India's profit after tax was at Rs 1,174.7 crore and its total income was Rs 17,171.3 crore. Its exports in FY22 were at Rs 976 crore.
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