LG Electronics Q1 FY27 Results (NSE: LGEINDIA)
Signal: Margin expansion
The read
The key inflection is operating profitability: derived EBITDA grew 26.2% YoY versus revenue growth of 15.5%, expanding EBITDA margin 106bps to 12.5% after the prior Q4FY26 PAT decline of 8.2%; however, Q1 revenue fell 10.2% sequentially and gross margin was still 22bps below last year.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹7,233.35 Cr | +15.5% | -10.2% |
| EBIT | ₹792.47 Cr | +26.6% | |
| Net profit | ₹652.86 Cr | +27.2% | |
| EPS | ₹9.62 | +27.2% | |
| EBIT margin | 12.5% |
P&L walk
Revenue increased to ₹72,333.50 million, +15.5% YoY but -10.2% QoQ; EBITDA margin expanded to 12.5%, +106bps YoY, as employee benefits and finance costs grew slower than revenue, while PAT rose 27.2% to ₹6,528.63 million and tracked EBIT growth.
Segments
Home entertainment was the momentum leader, with revenue up 22.3% YoY and segment result up 48.9% to ₹3,163.14 million, versus home appliances revenue growth of 13.6% and result growth of 14.6%.
Key positives
- PAT increased 27.2% YoY to ₹6,528.63 million, reversing the 8.2% YoY decline reported in Q4FY26.
- Derived EBITDA grew 26.2% YoY versus revenue growth of 15.5%, a 10.7pp growth gap, while EBITDA margin expanded 106bps to 12.5%.
- Employee benefits grew 9.9% YoY and finance costs grew 7.4%, both below revenue growth of 15.5%, supporting fixed-cost absorption.
- Home entertainment segment result rose 48.9% YoY to ₹3,163.14 million, materially outpacing group revenue growth.
Key concerns
- Revenue declined 10.2% QoQ to ₹72,333.50 million, with the larger home appliances and air solution division down 13.3% QoQ.
- Gross margin declined 22bps YoY to 31.4%, while raw materials remained broadly stable at 62.7% of revenue versus 62.8% in the year-ago quarter.
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