South Korean tech giant LG Electronics Inc. is continuing boosting its credibility and brand value in India as it prepares to list its Indian subsidiary.

It submitted a preliminary application at the end of 2024 and is currently adjusting the timeline of the listing due to recent market uncertainties.

The company is on track to restructure its production system to cover all of India with an aim to solidify its status as a “national brand” in the Indian market after it broke ground on a new factory in Sri City, southeastern India, on Thursday, which is a strategic step in advancing its India operations.

It aims to build a triangular production network connecting its existing facilities in Noida in northern India and Pune in the central west with the new facility in Sri City to enhance its supply capabilities across the country. The Noida plant specializes in home appliances, while the Pune plant focuses on TVs and display electronics.

The newly launched Sri City plant is positioned as a strategic hub for manufacturing premium appliances and exporting them to neighboring countries. The plant will span 1 million square meters of land and have a total floor area of 220,000 square meters, with a total investment of $600 million. It will start with the production of air conditioners by the end of 2026 and gradually expand to include washing machines, refrigerators, and compressors, with a target annual production capacity of over 5 million units by 2029.

Sri City is located near Chennai, a southeastern port city, offering excellent access to sea logistics. Its location complements the Noida and Pune plants, enabling balanced nationwide coverage.

LG Electronics’ expansion in India targets long-term dominance rather than short-term demand. India is considered a key “market of opportunity” due to its low home appliance penetration and high economic growth. The country’s washing machine penetration rate is around 30 percent and that of air conditioners just 10 percent.

As urbanization accelerates and the middle class grows, demand for premium products is expected to surge in the country. LG Electronics aims to secure supply capacity in advance and capture the high-end market, and localization is central to LG’s strategy in this regard.

Given India’s vegetarian dietary habits, there is high demand for larger refrigeration space. The company’s “convertible refrigerator,” which allows the freezer to be used as a fridge, is a flagship product for the market.

Its washing machines with a dedicated cycle for delicate saree fabrics are another example of localization. LG Electronics plans to increase local production of premium appliances such as French-door refrigerators and drum washing machines at Sri City.

Sales and service also set LG apart, with the company operating approximately 700 brand shops and 900 service centers across India while also aiming to provide a consistent customer experience before and after purchase.

This investment also targets markets beyond India. LG plans to use the Sri City facility as a base to expand exports across the Global South, including the Middle East, Africa, and Southeast Asia.

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