LG Electronics India IPO vs Tata Capital IPO: What GMP, experts signal about listing gain?

The LG Electronics IPO started slowly yesterday (October 7) but picked up pace towards the end of its first day, ultimately achieving full subscription. With two more full days of bidding ahead, enthusiasm remains high. By the end of day one, the LG IPO subscription status stood at 1.04x. Meanwhile, the Tata Capital IPO, which is closing today (October 8), was booked at 75% on its second day of bidding.

Analysts have varying opinions on these offerings, with some expressing optimism about both the LG Electronics and Tata Capital IPOs. Let's examine what experts are saying regarding these investment opportunities.

Tata Capital IPO includes a fresh issue of 21 crore shares and an offer for sale of 26.58 crore shares, with a price band set between ₹310 and ₹326. Arun Kejriwal, founder of Kejriwal Research and Investment Services, noted that this pricing is significantly lower than the unlisted price, which had traded as high as ₹1,100+ at the beginning of the year. He advises investors to exercise caution, as this marks the third consecutive offering on the main board where the issue price is significantly below its unlisted valuation.

LG Electronics IPO, consists of an offer for sale of 10.18 crore shares, priced between ₹1,080 and ₹1,140. Notably, LG Electronics will be the second South Korean company to list on the Indian stock exchanges, following Hyundai Motors' listing on October 22, 2024.

Tata Capital vs LG Electronics IPO: Where should you invest?

Prashanth Tapse, Sr VP Research – Research Analyst at Mehta Equities Ltd, said that for conservative long-term investors, we believe the Tata Capital IPO brings an opportunity to invest in India’s financial services space, combining scale, diversification, and strong brand credibility under the Tata Group.

Tapse said the company has delivered strong growth with steady improvement in revenue from operations and profitability. On the valuation front, based on the upper price band of ₹326, the issue is asking for a market cap of ₹1,38,383 crore.

“Based on FY 2026 annualised earnings and fully diluted post- IPO paid-up capital, the company is asking for a PB of 3.2x, which appears reasonably priced compared to ~4x average of its comparable listed peers, leaving healthy scope for long-term value creation,” he added.

Further, Prashanth Tapse noted that for investors seeking both short-term listing gains and long-term growth potential, LG Electronics India IPO offers an attractive entry into India’s leading home appliances and consumer electronics company. “As the market leader in key segments like washing machines, refrigerators, and televisions, LG Electronics India holds a dominant position backed by strong brand equity and deep market penetration. The IPO provides Indian investors a rare opportunity to participate in the long-term growth journey of a global consumer electronics giant,” according to Tapse.

At the upper end of the price band, the valuation appears reasonable when compared to domestic listed peers, many of which are trading at significantly higher multiples, he said. Additionally, strong tailwinds such as the ongoing festive season, GST-related benefits, and rising consumer incomes are expected to drive robust growth in the home appliances and electronics sector, supporting the company’s performance in the coming quarters, the expert added.

Abhinav Tiwari, Research Analyst at Bonanza said that both IPOs seem to be reasonably priced.

According to Tiwari, LG Electronics India demonstrates a strong financial profile with FY25 ROE of 37% and ROCE of 43%, supported by its dominant position in consumer durables, robust 13% EBITDA margins, and consistent profit expansion. Its extensive manufacturing base and nationwide distribution network enhance scalability and growth visibility. The IPO appears attractively priced at a trailing PE of ~35x, reasonable against peers, with proceeds directed toward capacity expansion and market growth, unlike Tata Capital IPO, which is primarily an Offer for sale with limited growth infusion.

Meanwhile, Tata Capital’s muted GMP reflects investor caution despite fair valuations. The merger with Tata Motor Finance Ltd. has led to asset quality deterioration (gross NPA 7.1%, net NPA 4.4% for TMFL), raising consolidated NPAs to ~1% from 0.5% and reducing ROE to 12.6% in FY25 from 14.2% in FY24. These concerns around profitability and integration challenges have weighed on investor sentiment ahead of the IPO.

IPO GMPs

Tata Capital IPO GMP today

Tata Capital IPO GMP today, or grey market premium, is ₹6. This indicates the Tata Capital share price is trading at a premium of ₹6 in the grey market, according to investorgain.com.

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Tata Capital is ₹332 apiece, which is 1.84% higher than the IPO price of ₹326.

Based on the grey market activities over the last 13 sessions, the IPO's grey market premium (GMP) is trending downward and is expected to decline further. Experts report that the lowest GMP recorded is ₹6, while the highest reached ₹30.

LG IPO GMP today

LG Electronics IPO GMP today is ₹298. This indicates LG Electronics share price is trading at a premium of ₹298 in the grey market, according to investorgain.com.

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of LG Electronics is ₹1,438 apiece, which is 26.14% higher than the IPO price of ₹1,140.

Based on the grey market activities observed over the last eight sessions, today's IPO Grey Market Premium (GMP) is trending upward, suggesting a strong listing is anticipated. Experts indicate that the lowest GMP recorded is ₹145.00, while the highest reaches ₹318.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.