The following discussion is intended to convey the managements perspective on our financial condition and results of operations for the three months ended June 30, 2025 and 2024, and Fiscals 2025, 2024 and 2023. Unless otherwise stated, the financial information in this section has been derived from the Restated Financial Information. Our financial year ends on March 31 of each year. Accordingly, references to "Fiscal 2025", "Fiscal 2024" and "Fiscal 2023", are to the 12-month period ended March 31 of the relevant year. Ind AS differs in certain respects from Indian GAAP, IFRS and U.S. GAAP and other accounting principles with which prospective investors may be familiar. Please also see "Risk Factors - Significant differences exist between Ind AS and other accounting principles, such as IFRS and U.S. GAAP, which may be material to investors assessments of our financial condition " on page 87. This discussion contains certain forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, such as the risks set forth in the chapters entitled "Risk Factors" and "Forward Looking Statements" beginning on pages 38 and 36, respectively.
Only to the extent explicitly indicated, industry and market data used in this section has been derived from the report titled ‘Industry Report for Appliances and Electronics Market in India dated September 2, 2025, prepared and issued by Redseer (the "Redseer Report"), commissioned by and paid for by our Company. Neither our Company, nor the Directors, Promoter or the BRLMs is related to Redseer as per the definition of "related party" under the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Redseer Report has been prepared and issued by Redseer for the purpose of understanding the industry exclusively in connection with the Offer. Unless otherwise indicated, all financial, operational, industry and other related information derived from the Redseer Report and included herein with respect to any particular fiscal or calendar year, refers to such information for the relevant fiscal or calendar year. For further details, see "Industry Overview" on page 148, respectively.
All references to "LG Group " refer to any company (individually or in the aggregate, as the context may require) that is (i) directly or indirectly owned or controlled by LG Electronics Inc. ("LG Electronics"), or (ii) directly or indirectly owns or controls LG Electronics.
Overview
We have been the number one player in major home appliances and consumer electronics (excluding mobile phones) in India for the six months ended June 30, 2025, CY2024, CY2023 and CY2022 as per the market share (in terms of value) in the offline channel, as noted in the Redseer Report. We are also market leaders in India across multiple product categories including washing machines, refrigerators, panel televisions, inverter air conditioners, and microwaves, based on the market share (in terms of value) in the offline channel (which represents approximately 78% and 77% of the major home appliances and consumer electronics market (excluding mobile phones) in India in terms of value in the same period) for the twelve-month period ending December 31, 2024 and the six months ended June 30, 2025, respectively, according to the Redseer Report. As of the 12-months ending December 31, 2024, and the six months period ending June 30, 2025, approximately eight out of ten air conditioners sold in India are based on inverter technology, according to Redseer Report. Our Company was incorporated in 1997 as a wholly owned subsidiary of LG Electronics, which is the leading single-brand global home appliances player in terms of market share by revenue in CY2024, according to the Redseer Report. We derive several benefits from our strong parentage including the "LG" brand which was listed on Interbrands Top 100 Best Global Brands in 2024. Our strong parentage, access to innovative technologies and commitment to quality, positions us as a trusted brand in India.
We offered one of the widest product portfolios amongst leading home appliances and consumer electronics players (excluding mobile phones) in India as of June 30, 2025, according to the Redseer Report. We sell products to B2C and B2B consumers in India and outside India. We also offer installation services, and repairs and maintenance services for all our products. In addition, we export our products to 47 countries across Asia, Africa and Europe, as of June 30, 2025, which provides us the optionality to sell products to targeted geographies, serving consumer demand beyond India.
Our Business Model
Revenue
We earn revenue primarily from the sale of our consumer electronics and home appliances products in India and outside India, and from rendering installation and after-sale services in India. We also earn other operating revenue from government grants in relation to revenue incentives from state governments, sale of scrap and export related incentives including duty drawback and incentives from the Remission of Duties and Taxes on Export Products scheme.
We have two business segments through which we cater to B2B and B2C consumers, comprising: (i) home appliances and air solution division covering the sale of products such as refrigerators, washing machines, air conditioners, water purifiers, dishwashers, microwave ovens, air purifiers and compressors, among others; and
(ii) home entertainment division covering the sale of products such as televisions, monitors, interactive displays and information systems. Until Fiscal 2022, we had a third segment - Mobile Communication division covering LG phones and related parts, which we fully discontinued in Fiscal 2023. It was a result of the strategic decision taken by LG Electronics in Fiscal 2022 to exit the competitive mobile business unit at a global level, to enable us and the LG Group to focus resources in other growth areas. The following table provides a breakdown of our revenue from operations by segment for the periods/years indicated:
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of revenue from operations* |
Rs million |
% of revenue from operations * |
Rs million |
% of revenue from operations * |
Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations * |
| Home appliances and air solution division | 49,082.30 | 78.37% | 50,609.38 | 78.97% | 182,678.57 | 74.97% | 156,797.49 | 73.43% | 150,306.78 | 75.65% |
| Home entertainment division | 13,547.08 | 21.63% | 13,478.59 | 21.03% | 60,987.81 | 25.03% | 56,722.51 | 26.57% | 48,339.15 | 24.33% |
| Discontinued business segment - Mobile communications division | 36.46 | 0.02% | ||||||||
* includes revenue from continuing and discontinued operations
Between Fiscals 2023 and 2025, our revenue from operations grew at a CAGR of 10.74%, while our revenue from our home appliances and air solution division and our revenue from our home entertainment division grew at a CAGR of 10.24% and 12.32%, respectively. Between the three months ended June 30, 2024 and June 30, 2024, our revenue from operations decreased primarily due to a decrease in our revenue from our home appliances and air solution division.
The following table provides a breakdown of our revenue from the sale of products and rendering of services for the periods/years indicated:
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of revenue from operations* |
Rs million |
% of revenue from operations* |
Rs million |
% of revenue from operations* |
Rs million | % of revenue from operations * |
Rs million | % of revenue from operations * |
| Sale of manufactured goods | 53,551.95 | 85.51% | 53,950.01 | 84.18% | 209,674.75 | 86.05% | 183,043.06 | 85.73% | 169,430.40 | 85.28% |
| Sale of stock-in- trade | 6,930.12 | 11.07% | 7,446.08 | 11.62% | 25,232.79 | 10.36% | 23,488.07 | 11.00% | 23,308.64 | 11.73% |
| Total sale of products | 60,482.07 | 96.57% | 61,396.09 | 95.80% | 234,907.54 | 96.41% | 206,531.13 | 96.73% | 192,739.04 | 97.01% |
| Service income | 986.48 | 1.58% | 928.82 | 1.45% | 3,217.70 | 1.32% | 2,865.02 | 1.34% | 2,446.40 | 1.23% |
| Installation and commissioning | 888.98 | 1.42% | 856.50 | 1.34% | 3,441.30 | 1.41% | 2,904.12 | 1.36% | 2,399.86 | 1.21% |
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations * | Rs million |
% of revenue from operations * |
| Total rendering of services | 1,875.46 | 2.99% | 1,785.32 | 2.79% | 6,659.00 | 2.73% | 5,769.14 | 2.70% | 4,846.26 | 2.44% |
* includes revenue from continuing and discontinued operations
We recognize revenue from operations from the sale of products (net of returns) and rendering of services. Our revenue from sale of products primarily includes products that we manufacture at our manufacturing units. It also includes revenue from the sale of stock-in-trade which refers to finished products, such as audio systems, vacuum cleaners, dishwashers and air purifiers, that we source from other members of the LG Group and in some instances from third-parties and sell "as-is" without modifications under the LG brand. With respect to entry-level refrigerators, washing machines, window air conditioners and small-size televisions that are manufactured on a stock-in-trade basis, we typically provide blueprints, specifications and key materials to third-party suppliers to manufacture the products for us in India.
Our revenue from rendering services primarily includes revenue from (i) service income for annual maintenance contracts taken by end-consumers for the maintenance of their products; replacement of parts and other services provided to end-consumers for out-of-warranty services, and (ii) installations and commissioning services provided to end-consumers primarily for installation services.
The following table provides an overview of our revenue from continuing operations by segment and for major products for the periods/years indicated:
Three months ended June 30, |
Fiscal | |||||||||
2025 |
2024 |
2025 |
2024 |
2023 |
||||||
| Particulars | Rs million |
% of revenue from continuing operations |
Rs million |
% of revenue from continuing operations |
Rs million |
% of revenue from continuing operations |
Rs million |
% of revenue from continuing operations |
Rs million |
% of revenue from continuing operations |
| Home Appliance and Air Solution division | 49,082.30 | 78.37% | 50,609.38 | 78.97% | 182,678.57 | 74.97% | 156,797.49 | 73.43% | 150,306.78 | 75.67% |
| Refrigerators | 21,666.60 | 34.59% | 21,606.86 | 33.71% | 66,964.52 | 27.48% | 57,844.93 | 27.09% | 58,055.68 | 29.23% |
| Washing machines |
11,576.10 | 18.48% | 11,768.56 | 18.36% | 50,417.03 | 20.69% | 44,919.38 | 21.04% | 42,208.36 | 21.25% |
| Air conditioners |
12,773.84 | 20.40% | 14,148.19 | 22.08% | 52,708.23 | 21.63% | 42,901.58 | 20.09% | 39,906.05 | 20.09% |
| Others(1) | 3,065.76 | 4.90% | 3,085.77 | 4.82% | 12,588.79 | 5.17% | 11,131.60 | 5.21% | 10,136.69 | 5.10% |
| Home Entertainment division |
13,547.08 | 21.63% | 13,478.59 | 21.03% | 60,987.81 | 25.03% | 56,722.51 | 26.57% | 48,339.15 | 24.33% |
| Televisions | 10,466.28 | 16.71% | 10,455.89 | 16.31% | 49,248.15 | 20.21% | 45,583.29 | 21.35% | 39,320.27 | 19.79% |
| Others? | 3,080.80 | 4.92% | 3,022.70 | 4.72% | 11,739.66 | 4.82% | 11,139.22 | 5.22% | 9,018.88 | 4.54% |
| Total revenue from continuing operations | 62,629.38 | 100.00% | 64,087.97 | 100.00% | 243,666.38 | 100.00% | 213,520.00 | 100.00% | 198,645.93 | 100.00% |
(1) Others include water purifiers, air purifiers, dishwashers, microwave ovens, vacuum cleaners and compressors.
(2) Others include media display and audiovisual products, including monitors, interactive displays, and information systems, projectors, wireless speakers, personal computers and earbuds.
Between Fiscals 2023 and 2025, our revenue from refrigerators grew at a CAGR of 7.40%, our revenue from washing machines grew at a CAGR of 9.29%, our revenue from air conditioners grew at a CAGR of 14.93% and our revenue from other products in our home appliance and air solution division grew at a CAGR of 11.44%. Additionally, between Fiscals 2023 and 2025, our revenue from televisions grew at a CAGR of 11.91% while our revenue from other products in our home entertainment division grew at a CAGR of 14.09%. In the three months ended June 30, 2025, our revenue from refrigerators, televisions and others increased, which was offset by a decrease in revenue from washing machines and air conditioners.
We also offer installation services, and repairs and maintenance services for all our major products. The table below presents our revenue from sale of services based on segment for major products for the period/years indicated:
| Three months ended June 30, | Fiscal | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | |||||||||||
| Particulars | Service income |
Installat ion and Commis sioning |
Total - Renderi ng of Services |
Service income |
Installat ion and Commis sioning |
Total - Render i ng of Services |
Service income |
Installat ion and Commis sioning |
Total - Rende ring of Servic es |
Service income |
Install ation and Commi ssionin g |
Total - Render ing of Service s |
Service income |
Install ation and Commi ssionin g |
Total - Render ing of Service s |
| Home Appliance and Air Solutions | 825.44 | 732.64 | 1,558.08 | 790.35 | 745.83 | 1,536.18 | 2,654.59 | 2,909.99 | 5,564.58 | 2,290.21 | 2,515.33 | 4,805.54 | 1,867.71 | 2,046.48 | 3,914.19 |
| Refrigerators | 251.51 | 125.07 | 376.58 | 259.02 | 96.94 | 355.96 | 719.65 | 377.88 | 1,097.53 | 668.84 | 212.68 | 881.52 | 510.56 | 158.73 | 669.29 |
| Washing Machines | 289.77 | 82.86 | 372.63 | 220.03 | 65.40 | 285.43 | 1,120.47 | 324.11 | 1,444.58 | 876.74 | 240.37 | 1,117.11 | 703.45 | 225.02 | 928.47 |
| Air conditioners | 239.08 | 210.18 | 449.26 | 258.83 | 315.07 | 573.90 | 631.00 | 1,042.31 | 1,673.31 | 542.51 | 1,090.94 | 1,633.45 | 485.36 | 873.81 | 1,359.17 |
| Others(1) | 45.08 | 314.53 | 359.61 | 52.47 | 268.42 | 320.89 | 183.47 | 1,165.69 | 1,349.16 | 202.12 | 971.34 | 1,173.46 | 168.34 | 788.92 | 957.26 |
| Home Entertainme nt | 161.04 | 156.34 | 317.38 | 138.47 | 110.67 | 249.14 | 563.11 | 531.31 | 1,094.42 | 574.81 | 388.79 | 963.60 | 578.69 | 353.38 | 932.07 |
| Televisions | 157.81 | 143.88 | 301.69 | 135.07 | 100.05 | 235.12 | 538.12 | 496.26 | 1,034.38 | 567.37 | 355.38 | 922.75 | 558.88 | 335.90 | 894.78 |
| Others(2) | 3.23 | 12.46 | 15.69 | 3.40 | 10.62 | 14.02 | 24.99 | 35.05 | 60.04 | 7.44 | 33.41 | 40.85 | 19.81 | 17.48 | 37.29 |
| Total | 986.48 | 888.98 | 1,875.46 | 928.82 | 856.50 | 1,785.32 | 3,217.70 | 3,441.30 | 6,659.00 | 2,865.02 | 2,904.12 | 5,769.14 | 2,446.40 | 2,399.86 | 4,846.26 |
(1) Others include water purifiers, air purifiers, dishwashers, microwave ovens, vacuum cleaners and compressors.
(2) Others include media display and audiovisual products, including monitors, interactive displays, and information systems, projectors, wireless speakers, personal computers and earbuds.
Expenses
Our major expenses include
(i) cost of materials consumed,
(ii) purchases of stock-in-trade,
(iii) changes in inventories of finished goods, stock-in-trade and work-in-progress,
(iv) employee benefit expenses,
(v) depreciation and amortisation expense and
(vi) other expenses which primarily includes expenses related to freight and forwarding, sales promotion, royalty, advertisement and consumer service expenses.
Cost of materials consumed and purchase of stock-in-trade
Our cost of materials consumed primarily includes the costs of raw materials used in manufacturing our products, including certain forms of steel, copper, aluminum, polymers and components such as semiconductors, electromechanical parts, open cells and packaging materials, among others, for our manufacturing operations from a combination of domestic and foreign suppliers. Purchase of stock-in-trade primarily includes expenses incurred for purchasing finished products from third party suppliers and other members of the LG Group. For more details, see "Our Business - Our Suppliers" on page 218.
Changes in inventories of finished goods, stock-in-trade and work-in-progress
Our changes in inventories of finished goods, stock-in-trade and work-in-progress represent the difference between the closing inventories and the opening inventories of finished goods, stock-in-trade and work-in- progress for a specific period.
Employee benefits expense
Our employee benefits expenses primarily include salaries, wages and bonuses paid to our employees. It also includes contributions to provident and other funds, and staff welfare expenses. As of June 30, 2025 and 2024 and as of March 31, 2025, 2024 and 2023, our employee base was 3,796, 3,693, 3,810, 3,705, and 3,596, respectively, respectively.
Depreciation and amortisation expense
Our depreciation and amortisation expenses primarily include depreciation of owned assets (net of government gran amortization) in relation to our machinery and equipment and right of use assets associated with our lease properties.
Other expenses
Our other expenses primarily include expenses related to freight and forwarding, sales promotion, royalty, advertisement, and consumer service expenses.
• Freight and forwarding: primarily includes fees we pay to our logistic partner, LX Pantos Solutions India Private Limited for transporting products from our manufacturing units to warehouses, trade partners and end-consumers in India and for exports as well as for warehouse operations. It also includes fees paid to third-party transport service providers and to other courier companies for product delivery to B2C consumers through our LG website. For more details, see "Our Business - Distribution and Transportation" on page 216.
• Sales promotion: primarily includes expenses for engaging sales promoters across some of our channel partners stores to promote our products and provide technical details about our products to consumers. As of June 30, 2025 and 2024 and as of March 31, 2025, 2024 and 2023, we engaged 9,463, 9,597, 9,490, 9,300 and 9,193 sales promoters, respectively. Sales promotion expenses also include expense for in-store display fixtures, promotion road shows and dealer events. For more details, see "Our Business - Marketing" on page 217.
• Royalty: includes royalty that we pay to LG Electronics under the revised license agreement dated July 27, 2017, read with the addendums dated March 9, 2018, June 17, 2021, June 20, 2023, September 28, 2023 and November 18, 2024 ("License Agreement") with LG Electronics for the use of (i) the licensed brand, (ii) the technology claimed in the licensed patents, and (iii) the licensed technical know-how and other intellectual property rights for the Authorized Products (as defined in the License Agreement and in the "Definitions and Abbreviations" section on page 1). Under the terms of the License Agreement, from January 1, 2023, we are required to pay a royalty of 2.30% of net sales for Authorized Products (other than LCD televisions and monitors) and 2.40% of net sales for LCD televisions and monitors. For further details of the License Agreement, see "History and Certain Corporate Matters - Key terms of other subsisting material agreements" on page 240.
• Advertisement: primarily includes expenses related to our print, radio, television campaigns and digital marketing through multiple social media network. For more details on our marketing initiatives, see "Our Business - Marketing" on page 217.
• Consumer service expenses: primarily includes expenses related to parts consumed for repairs, maintenance and installation, call center expenses, LG center ("LGC") and exclusive service center ("ESC") related expenses, and expenses for operating spare warehouses. For more details on our services, see "Our Business - Service and Consumer Support - Services" on page 209.
Principal Factors Affecting our Financial Condition and Results of Operations
Demandfor our products and services and our ability to sell additional products and services
Our revenues depend on the market acceptance and demand for our products as it translates into the sales volumes of our products. According to the Redseer Report, Indias appliances and electronics market has grown at approximately 7% from CY2019 to CY2024 and this growth is expected to accelerate to approximately 11% from CY2024 to CY2029 driven by rising disposable incomes, growing urbanization, and increasing penetration of appliances and electronics in both urban and rural areas. The home appliances and consumer electronics market in India is highly underpenetrated as of June 30, 2025, according to the Redseer Report. Further, according to the Redseer Report, the growth of organized retail and e-commerce channels has significantly increased demand for appliances and electronics, driven by changes in consumer buying behavior. Redseer Report also notes that enhanced electricity supply and infrastructure in rural areas are increasing demand for large home appliances such as refrigerators, washing machines, and air conditioners. Reliable power access now allows brands to reach rural consumers, supported by localized services such as affordable maintenance plans and financing options, according to the Redseer Report.
The demand for our products and services depends on our ability to anticipate and respond to emerging consumer preferences and demands by ensuring continued and timely development of new products and services, as well as enhancements to existing products and services and stimulating consumer demand for new and upgraded products. Further, it also depends on our ability to sell a higher volume of our products across all price ranges. We address this demand by leveraging the global leadership of LG Electronics which is recognized as a pioneer of innovative technology according to the Redseer Report, to introduce new and innovative products and services for our consumers in India, and where necessary, tailor products to cater to Indian consumer preferences and local
requirements. For example, we were one of the first among leading players to introduce inverter air conditioners in India in 2014 and was the first and only player in India to move 100% to inverter technology in 2017, according to the Redseer Report. As of June 30, 2025, approximately eight out of 10 air conditioners sold in India were based on the inverter technology, according to the Redseer Report. In the premium market, we are focused on introducing in India products equipped with new technologies backed by AI, and have luxurious, sleek and modern designs. We are committed to incorporating advanced technological features backed by AI and the LG ThinQ technology for smart home integration in our products to enhance our consumer experience. For the volume market, we are dedicated to a strategy whereby we seek to provide a mix of products that are accessible, affordable, and designed for Indian consumers, including expanding our product portfolio into more affordable price points. Through targeted marketing and offering a wide products and services portfolio, our aim is to increase the number of LG products in a given household and drive consumers to upgrade their home appliances and consumer electronics products with our premium products. This requires us to expend resources towards efficient manufacturing, procurement of supplies, adopting new technologies, sales promotion and to expand our distribution network.
In addition, to provide consumers with prompt and quality support, which could be a key consideration in the consumers purchase decisions, we operate one of the largest after-sales service networks in terms of number of after-sales service center touchpoints among leading home appliances and consumer electronics players in India as of June 30, 2025, according to the Redseer Report. We provide installation and repairs/maintenance services through 1,006 service centers across urban and rural India, supported by 13,368 engineers and four call centers, as of June 30, 2025. We intend to continue strengthening our AMC offerings for our B2C and B2B consumers, with a focus on HVAC servicing for our B2B consumers. Further, we aim to offer quality and prompt one-stop services by expanding service network, improving service standards, deploying certified engineers and enhancing spare parts availability. We also plan to launch additional revenue streams such as subscription services that are long-term appliance rentals program to provide additional value to our consumers and serve as a recurring source of revenue. The level of investments made by us to launch these various initiatives, as well as the returns we are able to achieve on our investments, affect the Companys financial condition and results of operations.
Competition and our ability to introduce new products for the Indian market
According to the Redseer Report, players in the Indian appliances and electronics sector witness a broad range of competition from existing and new competitors ranging from large multinational companies to highly specialized entities that focus on a limited number of products and services. Known for competitive pricing, innovative marketing strategies, and rapid product cycles, these brands are pushing companies to differentiate through unique features, premium service quality, and innovation, according to the Redseer Report. To stay competitive, we may offer and adjust our promotional offers including discounts, cashbacks or promotional financing schemes to trade partners and consumers. Similar to other major home appliance consumer electronics companies, we face significant pricing pressures, as competitors offer trade partners and end-consumers price reductions in order to stimulate demand, which may, in turn, adversely affect our results of operations. It is important for us to introduce upgrades and new products periodically addressing consumer demands in terms of price, features and performance. We leverage our deep consumer insights, derived from our long operating history and direct consumer feedback from our distribution and service networks to tailor our products for the Indian consumers. We visit and interact with trade partners and conduct regular consumer surveys to understand consumer pain points and obtain real-time feedback. Our product development team then incorporates the feedback across parameters such as on consumer behavior, climate, regional factors and regulatory requirements, in order to enable us to introduce high-quality, relevant and innovative products to the market. In the B2B space, our aim is to leverage global technology of LG Group to expand our product portfolio, meet the specialized needs of high-value industries and expand into new industries, such as hospitality. We are expanding our portfolio to cover HVAC, commercial information displays, commercial washing machines, LED displays and electronic blackboards, to address the growing demand in the B2B industry. The ability of our new or upgraded products to achieve anticipated sales volumes, realize our investments and achieve economies of scale depends on their appeal to consumers and competitive pressures such as price, features and services, which in turn will affect our results of operations. See "Risk Factors - We may not be able to compete successfully in the highly competitive, price sensitive andfast evolving home appliances and consumer electronics markets (includingfrom foreign players as well as online-first brands players) which could have an adverse impact on our operations" on page 48; and "Risk Factors - We may not timely identify or effectively respond to evolving consumer tastes and preferences, including for premium products, which could negatively affect our relationship with our trade partners and consumers, the demand for our products and services, and our market share" on page 62.
Changes in price and availability of raw materials
Our operations and our suppliers ability to provide raw materials to us at competitive prices is affected by global commodity prices, inflation and our ability to negotiate with our suppliers effectively. For example, pricing and availability of commodities like steel and aluminum can be volatile due to numerous factors, including but not limited to general domestic and international economic conditions, geopolitical tensions, extreme weather shocks, import duties and tariffs and foreign currency exchange rates, according to the Redseer Report. Fluctuations in the cost of raw materials, supply interruptions or raw material shortages has a direct impact on the players ability to manufacture products on time and within budget, according to the Redseer Report. Based on market conditions and to offer competitive pricing, we may strategically pass through some of the increase in the cost of raw materials to our trade partners by increasing the price of our products. However, we may not be able to pass through all cost increases which could adversely affect our results of operations. Conversely, a reduction in product prices within the industry could lead to decreased revenue and margins for us if there is no corresponding reduction in raw material costs.
We are committed to the "Make in India" philosophy, whereby we manufacture our products domestically and, to the extent available, source a significant amount of our raw materials from domestic suppliers. We have been taking steps to increase raw materials sourced from domestic suppliers. In Fiscals 2023, 2024 and 2025, and in the three months ended June 30, 2024 and 2025, 50.48%, 48.82%, 53.79%, 58.29% and 54.12% of our suppliers were sourced locally. These localization efforts enable us to procure raw materials on short notice to meet consumer demands and lower our inventory and related costs, allowing us to competitively price our products. While we source a significant portion of our raw materials from suppliers within India, we source some raw materials from suppliers outside India, primarily from Korea. The following table provides a breakdown of raw materials sourced from India and outside India for the periods/years indicated:
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million | % purchases of raw materials | Rs million | % purchases of raw materials | Rs million | % purchases of raw materials | Rs million | % purchases of raw materials | Rs million | % purchases of raw materials |
| Purchases of raw materials sourced from India | 25,142.85 | 54.12% | 25,014.64 | 58.29% | 98,620.22 | 53.79% | 74,493.45 | 48.82% | 75,297.02 | 50.48% |
| Purchases of raw materials sourced from outside India | 21,314.20 | 45.88% | 17,902.60 | 41.71% | 84,736.38 | 46.21% | 78,092.63 | 51.18% | 73,861.08 | 49.52% |
| Purchases of raw materials sourced from Korea | 9,535.35 | 20.53% | 8,970.03 | 20.90% | 40,206.99 | 21.93% | 34,658.81 | 22.71% | 34,597.41 | 23.20% |
| Purchases of raw materials from other countries | 11,778.85 | 25.35% | 8,932.57 | 20.81% | 44,529.39 | 24.28% | 43,433.82 | 28.47% | 39,263.67 | 26.32% |
| Top-three of the other countries | ||||||||||
| Purchases of raw materials sourced from China | 5,679.02 | 12.22% | 4,278.88 | 9.97% | 20,336.53 | 11.09% | 18,968.16 | 12.43% | 20,452.06 | 13.71% |
| Purchases of raw materials sourced from Singapore | 2,699.76 | 5.81% | 2,250.68 | 5.24% | 10,852.34 | 5.92% | 12,931.68 | 8.48% | 8,501.70 | 5.70% |
| Purchases of raw materials sourced from Thailand | 1,257.28 | 2.71% | 748.52 | 1.74% | 5,195.51 | 2.83% | 4,040.78 | 2.65% | 3,878.27 | 2.60% |
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million | % purchases of raw materials | Rs million | % purchases of raw materials | Rs million | % purchases of raw materials | Rs million | % purchases of raw materials | Rs million | % purchases of raw materials |
| Purchases of raw materials | 46,457.05 | 100.00% | . 42,917.24 | 100.00% | >183,356.60 | 100.00% | 152,586.08 | 100.00% | 149,158.10 | 100.00% |
While we continue to depend on imports for some of our key raw materials, our aim is to depend less on imports for materials that can be sourced from India as domestic sourcing allows us to leverage the comparatively low manufacturing cost in India, reduce logistic costs and eliminates import duties that may otherwise be payable on foreign sourced supplies. We manage our inventory of raw materials based on rolling forecasts of consumer demand and order raw materials in advance of product announcements and shipments based on such forecasts. To mitigate any potential interruptions of supplies and the vulnerability of our production schedule, we generally source most of our raw materials from multiple suppliers. However, we depend on a limited number of suppliers for some of our key raw materials. The following table provides a breakdown of the raw materials, from our top suppliers for the periods/years indicated:
The table below highlights the percentage of purchases of raw material from our top-five suppliers, top-10 suppliers, and related parties for the periods/years indicated:
| Particulars | Three months ended June 30, | Fiscal | |||
| 2025 | 2024 | 2025 | 2024 | 2023 | |
Rs million unless otherwise indicated |
|||||
| Purchases of raw materials | 46,457.05 | 42,917.24 | 183,356.60 | 152,586.08 | 149,158.10 |
| Top-five suppliers as a % of purchases of raw materials?? | 22.08% | 21.45% | 22.69% | 26.09% | 22.85% |
| Top-10 suppliers as a % of purchases of raw materials (2)(3) | 32.25% | 31.44% | 32.82% | 36.78% | 35.78% |
| Purchases of raw materials sourced from related parties?1? as a % of purchases of raw materials | 14.37% | 14.42% | 15.25% | 17.06% | 19.27% |
| Purchases of raw materials sourced from non-related third parties other than related parties1? as a % of purchases of raw materials | 85.63% | 85.58% | 84.75% | 82.94% | 80.73% |
(1) One of our top-five suppliers during the three months ended June 30, 2025, one of our top-five suppliers during the three months ended June 30, 2024, one of our top-five suppliers during Fiscal 2025, one of our top-five suppliers during Fiscal 2024 and two of our top-five suppliers during Fiscal 2023 are from related parties.
(2) One of our top-10 suppliers during the three months ended June 30, 2025, two of our top-10 suppliers during the three months ended June 30, 2024, two of our top-10 suppliers during Fiscal 2025, three of our top-10 suppliers during Fiscal 2024 and four of our top-10 suppliers during Fiscal 2023 are from related parties.
(3) Our top-five or top-ten suppliers are primarily located in India and Korea.
(4) Raw materials sourced from related parties include chips, capacitors, ceramics, compressors, connectors, television display panels, among others.
(5) Includes duties and handling charges and excludes goods in transit.
Capital expenditure and production capacity
The following table provides a breakdown of our capital expenditure costs incurred for the periods/years indicated:
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations * | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations* |
| Capital expenditure (unallocable) | 1,902.73 | 3.04% | 731.01 | 1.14% | 5,320.97 | 2.18% | 3,616.00 | 1.69% | 5,424.00 | 2.73% |
* includes revenue from continuing and discontinued operations
In the three months ended June 30, 2025, Fiscals 2025, 2024 and 2023, we invested in enhancing our production facilities and upgrading equipment and manufacturing processes in order to increase efficiencies, additional economies of scale and support production of new products. In particular, in Fiscal 2023, we also installed a side- by-side refrigerator line at the Pune Manufacturing Unit and an air conditioner compressor line at the Noida Manufacturing Unit. In Fiscal 2025, we have installed a new system air conditioner indoor unit line at the Pune Manufacturing Unit, and made further technological improvements across the two plants in the three months ended June 30, 2025. We expect to continue making investments to support our growth. We intend to construct a third manufacturing unit in Andhra Pradesh to expand our manufacturing capacity to address the potential growth in demand for products. We expect to benefit from incentives for constructing the new manufacturing unit in Andhra Pradesh. Based on the Government Order dated November 26, 2024, issued by Andhra Pradesh Government, we are eligible for financial incentives under Andhra Pradesh Industrial Development Policy (4.0) 2024-29. The incentive will be in the form of waiver of stamp duty/ registration fees, subsidy on utilities, state GST refund on construction work, capital subsidy and subsidy for skilling of workers. We also intend to enhance our existing manufacturing capabilities by implementing additional automation technologies. Specifically, we intend to improve line capacity by reducing production loss, upgrading machines with machine cycle signal chart improvements, and altering product structures to enable ease of manufacturing. The amount of capital expenditure made by us, as well as the returns we are able to achieve on our capital expenditure investments, affect the Companys financial condition and results of operations. For more details on our manufacturing, see "Our Business - Manufacturing Units on page 211.
The following table provides a breakdown of our Return on Capital Employed for the periods/years indicated. Our Return on Capital Employed decreased in the three months ended June 30, 2025 due to a decrease in our EBIT in the three months ended June 30, 2025 and an increase in our capital employed as no dividends were paid during this period. See "- Non-GAAP Financial Measures " on page 371 for more details.
| Metric | Three Months Ended June 30, | Fiscal | |||
| 2025 | 2024 | 2025 | 2024 | 2023 | |
| Return on Capital Employed? (2) | 9.10% | 18.04% | 42.91% | 45.31% | 34.38% |
(1) Return on Capital Employed is defined as EBIT as a percentage of Capital Employed. Capital Employed is calculated as total equity (excluding amalgamation reserve) -plus lease liabilities. EBIT is calculated as profit before tax plus finance cost less other income.
(2) For the reconciliation to GAAP measures, see "- Non-GAAP Financial Measures " on page 371.
Our ability to pursue additional operational cost savings.
Many of our competitors may have used aggressive pricing and marketing strategies as well as different product design approaches and alternative technologies that consumers may prefer over those of ours, in order to maintain or gain market share. Accordingly, the success of our business depends, in part, on our continual reduction of manufacturing costs and operating expenses. The following table provides a breakdown of our cost of materials consumed, purchases of stock-in-trade and changes in inventories of finished goods, stock-in-trade and work-in- progress for the periods/years indicated:
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of revenue from operations* |
Rs million |
% of revenue from operations * |
Rs million |
% of revenue from operations * |
Rs million |
% of revenue from operations * |
Rs million |
% of revenue from operations * |
| Cost of materials consumed | 39,313.92 | 62.77% | 34,312.38 | 53.54% | 147,405.50 | 60.49% | 129,160.49 | 60.49% | 123,608.20 | 62.21% |
| Purchases of stock-in-trade | 5,544.80 | 8.85% | 5,638.68 | 8.80% | 19,729.36 | 8.10% | 19,357.72 | 9.07% | 18,787.63 | 9.46% |
| Changes in inventories of finished goods, stock-in-trade and work-in- progress | (2,027.38) | (3.24)% | 2,872.58 | 4.48% | (1,333.98) | (0.55)% | 783.57 | 0.37% | (2,115.10) | (1.06)% |
* includes revenue from continuing and discontinued operations
Our costs related to materials consumed, purchases of stock-in-trade, and changes in inventories of finished goods, stock-in-trade, and work-in-progress as a percentage of revenue from operations fluctuates. We continually engage in various cost optimization and other initiatives intended to increase efficiency and productivity, including refinement of our manufacturing processes to increase production yields, reduce production cycle time,
design innovations through changes in raw material structure as well as specification optimization. Further, we also arrange for direct deliveries to our trade partners to reduce our dependency on third parties, reduces delivery- lead times and optimizes our costs. Our results of operations and profitability will be affected by our ability to improve the cost efficiency of our operations.
Our ability to achieve cost savings may be affected if we manufacture products that do not meet consumer specifications or contain defects, in which case we may be faced with warranty claims from our consumers and recalls involving our products. For more details, see "Risk Factors - Our warranty reserves may be insufficient to coverfuture warranty claims, which could adversely affect ourfinancial condition and results of operations" on page 65. We recognize provisions for product warranties for the estimated costs of future warranty claims based on our historical experience. While we have established provisions with respect to potential warranty costs relating to our products sold to consumers, there is no guarantee that such provisions will be sufficient to cover all of our warranty costs relating to our products. We may also recognize additional provisions for warranty expenses in relation to potential future warranty claims.
Seasonality
The sales volumes of some our products are influenced by the cyclicality and seasonality of demand. Typically, demand for some of our products such as air conditioners, compressor, air purifiers and refrigerators increase in the summer months in India between April and July and is lean during the winter months between September and December. The demand for washing machines and water purifiers increases in the second quarter of the fiscal year during the monsoon season, and the demand for all products also increases in the second half of a fiscal year due to festivals and marriage season. However, if temperatures remain temperate, it can adversely affect our usual demand for these products which can negatively impact our revenues, as is evidenced by the decrease in our revenue in the three months ended June 30, 2025 compared to the three months ended June 30, 2024. We plan our inventories and monitor inventory adequacy status in line with annual, quarterly and monthly sales plans which factor in the effects of seasonality and cyclicality of product demands. We also coordinate with our logistics providers and warehouses for advanced inventory planning. Additionally, our product mix across multiple product categories helps us manage the impact of seasonality on our sales.
Support from LG Electronics and the "LG" brand
We have the support of LG Electronics in many aspects of our business including management, R&D, design, product planning, manufacturing, supply chain development, quality control, marketing, distribution, brand, human resources and financing, among others. Specifically, we are well connected with other operating entities within the LG Group in other geographic areas, regularly exchanging information on emerging market trends, changing consumer preferences, manufacturing processes and supply chain. Additionally, in India, we have leveraged the "LG" brand image and associated consumer loyalty to maintain our market leadership as the number one player in major home appliances and consumer electronics (excluding mobile phones) in India for the six months ended June 30, 2025, CY2024, CY2023 and CY2022 as per the market share (in terms of value) in the offline channel, as noted in the Redseer Report. We have entered into various agreements and transactions with our Promoter, LG Electronics, such as the License Agreement under which LG Electronics has granted our Company an exclusive, non-transferable, non-assignable and indivisible license to use its licensed brand, technology and technical know-how for the Authorized Products. For further details on the License Agreement, see "History and Certain Corporate Matters - Key terms of other subsisting material agreements" on page 240. Our Company and our Promoter have entered into a Framework agreement dated November 25, 2024 ("Framework Agreement") to record the principal terms of provision of Services and Deliverables by our Company, our Promoter and the LG Group Companies ("Group Transactions"). See "History and Certain Corporate Matters - Key terms of other subsisting material agreements" on page 240. The continued support of LG Electronics is critical to our ability to provide high-quality and innovative products and services to consumers. The current royalty rate payable to LG Electronics is 2.30% for all products manufactured by us other than televisions and monitors and 2.40% for "LCD" televisions and monitors of our net sales of the products. The following table shows the royalty to LG Electronics Inc, South Korea for the periods/years indicated:
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million | % of revenue from operations |
Rs million | % of revenue from operations |
Rs million | % of revenue from operations |
Rs million | % of revenue from operations |
Rs million | % of revenue from operations |
| Royalty | 1,175.02 | 1.88% | 1,215.08 | 1.90% | 4,546.10 | 1.87% | 4,032.30 | 1.89% | 3,232.44 | 1.63% |
*includes revenue from continuing and discontinued operations
Additionally, we paid an interim dividend to our Shareholder, LG Electronics, periodically. The table below shows the dividend paid to LG Electronics for the periods/years indicated:
| Particulars | Three months ended June 30, | Fiscal | |||
| 2025 | 2024 | 2025 | 2024 | 2023 | |
| Rs million | Rs million | Rs million | Rs million | ||
| Interim dividend paid | - | - | - | 20,928.82 | 24,888.32 |
| Net Sales** | 62,503.57 | 63,311.86 | 242,089.98 | 212,731.01 | 197,947.18 |
| Dividend as % of Net Sales | - | - | - | 9.84% | 12.57% |
| Calculation of Net Sales | |||||
| Total - sale of stock-in-trade | 6,930.12 | 7,446.08 | 25,232.79 | 23,488.07 | 23,308.64 |
| Total - sale of manufactured goods | 53,551.95 | 53,950.01 | 209,674.75 | 183,043.06 | 169,430.40 |
| Total - rendering of services | 1,875.46 | 1,785.32 | 6,659.00 | 5,769.14 | 4,846.26 |
| Sale of scrap | 146.04 | 130.45 | 523.44 | 430.74 | 361.88 |
** includes sales of stock-in-trade, sale of manufactured goods, rendering of services and sale of scrap in relation to continuing operations
In addition, we enter into various transactions with related parties. For further information see "Other Financial Information - Related Party Transactions on page 352.
Foreign exchange fluctuations
Our consolidated financial statements are prepared in Indian rupees. However, a portion of our sales is denominated in currencies other than Indian rupees, particularly the U.S. dollar, and our purchases of raw materials from overseas suppliers are denominated primarily in U.S. dollars. Accordingly, our consolidated financial statements may be affected by exchange rate fluctuations. To the extent that we incur costs in one currency and derive sales in another currency, our results of operations may be affected by the relative strengths of the two currencies. Although the impact of exchange rate fluctuations has in the past been partially mitigated by our hedging strategies, including forward exchange contracts, we have foreign currency exposures that have not been hedged by a derivative instrument or otherwise. For more details, see "Notes to the Restated Financial Information - Note 37 - Details on derivatives instruments and unhedgedforeign currency exposure" on page 328. Our results of operations have historically been affected by exchange rate fluctuations, and there can be no assurance that such strategies will be effective in eliminating or reducing the adverse impact of future fluctuations.
Results of Operations
The following table sets forth select financial data from our restated consolidated statement of profit and loss for the three months ended June 30, 2025 and 2024 and Fiscals 2025, 2024 and 2023, the components of which are also expressed as a percentage of total income for such years/ period.
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of total income* |
Rs million |
% of total income | Rs million |
% of total income* | Rs million |
% of total income | Rs million |
% of total income* |
| Continuing operations | ||||||||||
| Income | ||||||||||
| Revenue from operations | 62,629.38 | 98.83% | 64,087.97 | 99.10% | 243,666.38 | 98.93% | 213,520.00 | 99.05% | 198,645.93 | 98.77% |
| Other income | 744.26 | 1.17% | 580.00 | 0.90% | 2,639.90 | 1.07% | 2,051.18 | 0.95% | 2,439.91 | 1.21% |
| Total income | 63,373.64 | 100.00% | 64,667.97 | 100.00% | 246,306.28 | 100.00% | 215,571.18 | 100.00 % | 201,085.84 | 99.98% |
| Expenses | ||||||||||
| Cost of materials consumed | 39,313.92 | 62.04% | 34,312.38 | 53.06% | 147,405.50 | 59.85% | 129,160.49 | 59.92% | 123,608.20 | 61.46% |
| Purchases of stock-in-trade | 5,544.80 | 8.75% | 5,638.68 | 8.72% | 19,729.36 | 8.01% | 19,357.72 | 8.98% | 18,787.63 | 9.34% |
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of total income* |
Rs million |
% of total income | Rs million |
% of total income | Rs million |
% of total income | Rs million |
% of total income |
| Changes in inventories of finished goods, stock-in-trade and work-in- progress | (2,027.38) | (3.20)% | 2,872.58 | 4.44% | (1,333.98) | (0.54)% | 783.57 | 0.36% | (2,115.10) | (1.05)% |
| Employee benefits expense | 2,535.97 | 4.00% | 2,408.62 | 3.72% | 9,627.94 | 3.91% | 8,868.24 | 4.11% | 7,991.56 | 3.97% |
| Finance costs | 85.03 | 0.13% | 69.35 | 0.11% | 306.46 | 0.12% | 285.05 | 0.13% | 225.84 | 0.11% |
| Depreciation and amortisation | 902.41 | 1.42% | 967.21 | 1.50% | 3,803.57 | 1.54% | 3,643.69 | 1.69% | 3,003.93 | 1.49% |
| expense | ||||||||||
| Other expenses | 10,099.34 | 15.94% | 9,275.05 | 14.34% | 37,136.32 | 15.08% | 33,101.25 | 15.36% | 31,380.49 | 15.60% |
| Total expenses | 56,454.09 | 89.08% | 55,543.87 | 85.89% | 216,675.17 | 87.97% | 195,200.01 | 90.55% | 182,882.55 | 90.93% |
| Profit before tax from continuing operations | 6,919.55 | 10.92% | 9,124.10 | 14.11% | 29,631.11 | 12.03% | 20,371.17 | 9.45% | 18,203.29 | 9.05% |
| Tax expense | ||||||||||
| Current tax | 1,767.59 | 2.79% | 2,373.40 | 3.67% | 7,900.87 | 3.21% | 5,567.39 | 2.58% | 4,794.35 | 2.38% |
| Current tax expense relating to previous year | (1.06) | 0.00% | 40.08 | 0.02% | 13.73 | 0.01% | ||||
| Deferred tax | 19.41 | 0.03% | (45.76) | (0.07)% | (302.18) | (0.12)% | (346.98) | (0.16)% | (84.99) | (0.04)% |
| Total tax expense | 1,787.00 | 2.82% | 2,327.64 | 3.60% | 7,597.63 | 3.08% | 5,260.49 | 2.44% | 4,723.09 | 2.35% |
| Profit for the period / year from continuing operations | 5,132.55 | 8.10% | 6,796.46 | 10.51% | 22,033.48 | 8.95% | 15,110.68 | 7.01% | 13,480.20 | 6.70% |
| Discontinued operations | ||||||||||
| Loss from discontinued operations before tax | (42.00) | (0.02)% | ||||||||
| Tax expense of discontinued operations | (11.10) | (0.01)% | ||||||||
| Loss after tax from discontinued operations | (30.90) | (0.02)% | ||||||||
| Profit for the period / year | 5,132.55 | 8.10% | 6,796.46 | 10.51% | 22,033.48 | 8.95% | 15,110.68 | 7.01% | 13,449.30 | 6.69% |
| Total comprehensive income for the period / year | 5,141.03 | 8.11% | 6,805.19 | 10.52% | 21,979.24 | 8.92% | 15,088.83 | 7.00% | 13,443.32 | 6.68% |
Notes: Until Fiscal 2022, we had a third segment—Mobile Communication division covering LG phones and related parts, which we fully discontinued in Fiscal 2023. It was a result of the strategic decision taken by LG Electronics in Fiscal 2022 to exit the competitive mobile business unit at a global level, to enable us and the LG Group to focus resources in other growth areas.
*includes income/loss from continuing and discontinued operations.
Revenue and segment results by segment
The following table provides a breakdown of our revenue from operations by segment and segment results for the periods/years indicated:
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of total income |
Rs million |
% of total income | Rs million |
% of total income | Rs million |
% of total income | Rs million |
% of total income |
| Revenue from operations | ||||||||||
| Home appliances and air solution division | 49,082.30 | 77.45% | 50,609.38 | 78.26% | 182,678.57 | 74.17% | 156,797.49 | 72.74% | 150,306.78 | 74.73% |
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of total income * |
Rs million |
% of total income* | Rs million |
% of total income * | Rs million |
% of total income * | Rs million |
% of total income* |
| Home entertainment division | 13,547.08 | 21.38% | 13,478.59 | 20.84% | 60,987.81 | 24.76% | 56,722.51 | 26.31% | 48,339.15 | 24.03% |
| Discontinued business segment - Mobile communications division | - | - | - | - | - | - | - | - | 36.46 | 0.02% |
| Segment results | ||||||||||
| Home appliances and air solution division | 5,642.57 | 8.90% | 7,571.22 | 11.71% | 23,434.32 | 9.51% | 16,742.92 | 7.77% | 12,998.48 | 6.46% |
| Home entertainment division | 2,124.83 | 3.35% | 2,336.92 | 3.61% | 9,309.10 | 3.78% | 6,879.90 | 3.19% | 8,072.69 | 4.01% |
| Discontinued business segment - Mobile communications division | (42.00) | (0.02%) | ||||||||
Notes: Until Fiscal 2022, we had a third segment—Mobile Communication division covering LG phones and related parts, which we fully discontinued in Fiscal 2023. It was a result of the strategic decision taken by LG Electronics in Fiscal 2022 to exit the competitive mobile business unit at a global level, to enable us and the LG Group to focus resources in other growth areas.
* includes income/loss from continuing and discontinued operations
The following table provides a breakdown of our revenue from operations by geography for the period indicated:
| Three months ended June 30, | Fiscal | |||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
| Particulars | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations * | Rs million |
% of revenue from operations * | Rs million |
% of revenue from operations* |
| Domestic | 59,301.27 | 94.69% | 60,507.68 | 94.41% | 229,143.82 | 94.04% | 203,635.32 | 95.37% | 189,137.76 | 95.20% |
| Africa(1) | 548.90 | 0.87% | 521.39 | 0.81% | 2,414.24 | 0.99% | 1,693.39 | 0.79% | 1,777.06 | 0.89% |
| Asia (excluding India)(2) | 2,635.20 | 4.21% | 3,054.51 | 4.77% | 12,100.86 | 4.97% | 8,162.78 | 3.83% | 7,728.49 | 3.89% |
| America? | 139.51 | 0.22% | 3.31 | 0.01% | 3.85 | 0.00% | 10.09 | 0.00% | 9.90 | 0.00% |
| Europe1-4-1 | 0.04 | 0.00% | 0.02 | 0.00% | 0.06 | 0.00% | 0.51 | 0.00% | 11.48 | 0.01% |
| Others (5) | 4.46 | 0.01% | 1.06 | 0.00% | 3.55 | 0.00% | 17.91 | 0.01% | 17.70 | 0.01% |
| Revenue from operations* | 62,629.38 | 100.00% | 64,087.97 | 100.00% | 243,666.38 | 100.00% | 213,520.00 | 100.00% | 198,682.39 | 100.00% |
(1) includes Algeria, Benin, Cameroon, Cape Verde, Congo, Cote dIvoire, Egypt, Ethiopia, Gabon, Gambia, Ghana, Guinea, Kenya, Libya, Mauritania (Fiscal 2023), Mauritius, Madagascar, Morocco, Nigeria, Sao Tome (Fiscals 2023 and 2025), Senegal, Seychelles, Somalia, South Africa, Sudan, Tanzania, Togo, Tunisia, Zambia, Zimbabwe, Sao Tome (Fiscal 2025) and Angola.
(2) includes Azerbaijan, Bahrain, Bangladesh, Brunei, Cambodia (Fiscal 2023), China, Hong Kong Special Administrative Region of China (Fiscal 2024 and 2025), Indonesia, Iraq, Israel, Jordan, Kazakhstan, Lebanon, Malaysia, Maldives (Fiscal 2023), Nepal, Oman, Philippines, Qatar, Republic of Korea,, Saudi Arabia, Singapore, Sri Lanka, Taiwan, Thailand, Turkey, United Arab Emirates, Vietnam, Yemen and Georgia.
(3) includes Argentina (Fiscals 2022 and 2023), Canada, Chile, Dominican Republic (Fiscals 2023 and 2024),Mexico, Panama, Peru (Fiscal
2024 and 2025), Puerto Rico (Fiscal 2023), Brazil (Fiscal 2025) and United States.
(4) includes France (Fiscal 2023), Greece (Fiscals 2023), Netherlands, Poland (Fiscals 2023 and 2024) and Spain
(5) includes Australia and Fiji.
*includes revenue from continuing and discontinued operations
Three Months Ended June 30, 2025 Compared to Three Months Ended June 30, 2024 Income
Our total income decreased by 2.00% to Rs63,373.64 million in the three months ended June 30, 2025 from Rs64,667.97 million in the three months ended June 30, 2024, primarily due to:
• A decrease in the revenue from our Home Appliances and Air Solution Division by 3.02% to Rs49,082.30 million in the three months ended June 30, 2025 from Rs50,609.38 million in the three months ended June 30, 2024. In particular, our revenue from the sale of air conditioners decreased with a decrease in the
demand for these products due to a temperate summer in first quarter of Fiscal 2025. For more details, see Our Business Model" on page 353.
• Our revenue from our Home Entertainment Division remained stable at Rs13,547.08 million in the three months ended June 30, 2025 as compared to Rs13,478.59 million in the three months ended June 30, 2024. For more details, see " - Our Business Model" on page 353.
However, our revenue from rendering services increased by 5.05% to Rs1,875.46 million in the three months ended June 30, 2025 from Rs1,785.32 million in the three months ended June 30, 2024. Our revenue from service income increased by 6.21% to Rs986.48 million in the three months ended June 30, 2025 from Rs928.82 million in the three months ended June 30, 2024 primarily due to an increase in parts sales in the three months ended June 30, 2025 compared to three months ended June 30, 2024 in line with an increase in the demand for such services in respect of washing machines and televisions. Further, our revenue from installations and commissions increased by 3.79% to Rs888.98 million in the three months ended June 30, 2025 from Rs856.50 million in the three months ended June 30, 2024, primarily due to deferred sales revenue from promotional warranty offered in Fiscal 2024, which was recognized as revenue after the expiry of the standard warranty term in the three months ended June 30, 2025.
Our revenue from sale of stock-in-trade decreased by 6.93% to Rs6,930.12 million in the three months ended June 30, 2025 from Rs7,446.08 million in the three months ended June 30, 2024, primarily due to a decrease in the sales volume of air conditioners with a decrease in the demand for these products due to a temperate summer in the first quarter of Fiscal 2025 and we started to manufacture certain models of refrigerators and televisions in-house.
Our other operating revenue decreased by 70.01% to Rs271.85 million in the three months ended June 30, 2025 from Rs906.56 million in the three months ended June 30, 2024, primarily due to the recognition of the Uttar Pradesh government grant for the Noida Manufacturing Unit in June 2024, which covered a period of 54 months from January 2020 to June 2024. In contrast, we only recognized the grant for the three months ended June 30, 2025, in June 2025. Additionally, the Maharashtra state government grant for the Pune Manufacturing Unit was discontinued from May 2025.
Our other income increased by 28.32 % to Rs744.26 million in the three months ended June 30, 2025 from Rs580.00 million in the three months ended June 30, 2024, primarily due to an increase in interest income on bank deposits as a result of an increase in the amount of fixed deposit with banks.
Expenses
Cost of materials consumed
Our cost of materials consumed increased by 14.58% to ^39,313.92 million in the three months ended June 30, 2025 from Rs34,312.38 million in the three months ended June 30, 2024, primarily because there was an increase in the raw materials that we sourced to support the increase in our production volumes in line with our business plan.
Purchases of stock-in-trade
Our purchases of stock-in-trade decreased by 1.66% to Rs5,544.8 million in the three months ended June 30, 2025 from Rs5,638.68 million in the three months ended June 30, 2024, in line with the decrease in revenue from sale of stock-in-trade.
Employee benefits expense
Our employee benefit expenses increased by 5.29% to Rs2,535.97 million in the three months ended June 30, 2025 from Rs2,408.62 million in the three months ended June 30, 2024, primarily due to an increase in our employee base from 3,693 as of June 30, 2024 to 3,796 as of June 30, 2025, including employees at senior levels, which caused an increase in salaries, wages and bonus.
Changes in inventories of finished goods, stock-in-trade and work-in-progress
Our changes in inventories increased to Rs(2,027.38) million in the three months ended June 30, 2025 as compared to a decrease in inventories to Rs2,872.58 million in the three months ended June 30, 2024 primarily due to an
increase in closing inventories, mainly as a result a decrease in the sales volume of air conditioners with a decrease in the demand for these products due to a temperate summer in 2025.
Finance costs
Our finance costs increased by 22.61% to Rs85.03 million in the three months ended June 30, 2025 from Rs69.35 million in the three months ended June 30, 2024, which was primarily due to an increase in lease liabilities because of the renewal and conversion of lease agreements from short-term to long-term leases for warehouses and offices after June 2024.
Depreciation and amortisation expense
Our depreciation and amortisation expense remained stable at Rs902.41 million in the three months ended June 30, 2025 as compared to Rs967.21 million in the three months ended June 30, 2024.
Other expenses
Our other expenses increased by 8.89% to Rs10,099.34 million in the three months ended June 30, 2025 from Rs9,275.05 million in the three months ended June 30, 2024, which was primarily attributable to an increase in following expenses:
• Customer service. Our customer service expense increased by 18.38% to Rs945.71 million in the three months ended June 30, 2025 from Rs798.91 million in the three months ended June 30, 2024 primarily due to an increase in the parts sourced for our services business and other service-related expenses.
• Freight and forwarding. Our freight and forwarding expense increased by 13.88% to Rs2,556.11 million in the three months ended June 30, 2025 from Rs2,244.47 million in the three months ended June 30, 2024, primarily due to an increase in freight and forwarding expenses from manufacturing units to warehouses to maintain stock levels for sale, as well as increased export freight costs due to increased sales in Africa where freight and forwarding expenses are generally higher.
• Waste of electrical and electronic equipment. Our waste of electrical and electronic equipment expense increased by 40.23% to Rs690.62 million in the three months ended June 30, 2025 from Rs492.50 million in the three months ended June 30, 2024, primarily because of an increase in our recycling target and the recycling fee rates.
Partially offset by a decrease in:
• Royalty. Our royalty expense decreased by 3.30% to Rs1,175.02 million in the three months ended June 30, 2025 from Rs1,215.08 million in the three months ended June 30, 2024, consistent with a decrease in revenue in the three months ended June 30, 2025.
• Sales promotion. Our sales promotion expense decreased by 2.96% to Rs1,664.03 million in the three months ended June 30, 2025 from Rs1,714.76 million in the three months ended June 30, 2024, as a result of a decrease in the number of sales promoters from 9,597 as of June 30, 2024 to 9,463 as of June 30, 2025 and the related expenses to engage promoters to support our growing sales network.
Tax Expense
Our tax expense decreased by 23.23% to Rs1,787.00 million in the three months ended June 30, 2025 from Rs2,327.64 million in the three months ended June 30, 2024, primarily due to a decrease in profit before tax by 24.16%.
Profit for the Period
As a result of the foregoing factors, our profit for the period decreased by 24.48% to Rs5,132.55 million in the three months ended June 30, 2025 from Rs6,796.46 million in the three months ended June 30, 2024.
Fiscal 2025 compared to Fiscal 2024 Income from Continuing Operations
Our total income increased by 14.26% to Rs246,306.28 million in Fiscal 2025 from ^215,571.18 million in Fiscal 2024, primarily due to:
• An increase in the revenue from our Home Appliances and Air Solution Division by 16.51% to Rs182,678.57 million in Fiscal 2025 from Rs156,797.49 million in Fiscal 2024. This increase was due to an increase in the sales volume of our home appliances and air solution products sold, and related services rendered. In particular, our revenue from the sale of refrigerators, washing machines and air conditioners increased with an increase in the demand for these products. For more details, see "- Our Business Model on page 353.
• Our revenue from our Home Entertainment Division increased by 7.52% to Rs60,987.81 million in Fiscal 2025 from Rs56,722.51 million in Fiscal 2024. This increase was due to an increase in the sales volumes of our home entertainment products, in particular, televisions, and the increase in the selling price of other Home Entertainment products. For more details, see "- Our Business Model on page 353.
Our revenue also increased with an increase in revenue from rendering services by 15.42% to Rs6,659.00 million in Fiscal 2025 from Rs5,769.14 million in Fiscal 2024. Our revenue from service income increased by 12.31% to Rs3,217.70 million in Fiscal 2025 from Rs2,865.02 million in Fiscal 2024 primarily due to an increase in the parts sales in Fiscal 2025 compared to Fiscal 2024 in line with an increase in the demand for such services. Further, our revenue from installations and commissioning increased by 18.50% to Rs3,441.30 million in Fiscal 2025 from Rs2,904.12 million in Fiscal 2024 primarily due to an increase in the annual maintenance contracts entered in to in Fiscal 2025 compared to Fiscal 2024.
Our revenue from sale of stock-in-trade increased to Rs25,232.79 million in Fiscal 2025 from Rs23,488.07 million in Fiscal 2024 primarily due to an increase in the sales of room air conditioners.
Our other operating revenue increased by 72.16% to Rs2,099.84 million in Fiscal 2025 from Rs1,219.73 million in Fiscal 2024, primarily due to the recognition of the Uttar Pradesh government grant for the Noida Manufacturing Unit in June 2024, which covered a period of 54 months from January 2020 to June 2024.
Our other income increased by 28.70% to Rs2,639.90 million in Fiscal 2025 from Rs2,051.18 million in Fiscal 2024, primarily due to an increase in interest income on bank deposits as a result of an increase in the amount of fixed deposit with banks and an increase in interest income on refund of income tax from the government.
Expenses
Cost of materials consumed
Our cost of materials consumed increased by 14.13% to Rs147,405.50 million in Fiscal 2025 from Rs129,160.49 million in Fiscal 2024, primarily because there was an increase in the raw materials that we sourced to support the increase in our production volumes in line with our business plan.
Purchases of stock-in-trade
Our purchases of stock-in-trade increased by 1.92% to Rs 19,729.36 million in Fiscal 2025 from Rs19,357.72 million in Fiscal 2024, primarily due to an increase in demand for such products.
Employee benefits expense
Our employee benefit expenses increased by 8.57% to Rs9,627.94 million in Fiscal 2025 from Rs8,868.24 million in Fiscal 2024, primarily due to an increase in our employee base from 3,705 as of March 31, 2024 to 3,810 as of March 31, 2025, including employees at senior levels, which caused an increase in salaries, wages and bonus.
Changes in inventories of finished goods, stock-in-trade and work-in-progress
Our changes in inventories increased to Rs(1,333.98) million in Fiscal 2025 as compared to a decrease in inventories to Rs783.57 million in Fiscal 2024 primarily due to an increase in the closing inventories, mainly as a result of an increase in production and inventory of washing machines pursuant to our business plan.
Finance costs
Our finance costs increased by 7.51% to Rs306.46 million in Fiscal 2025 from Rs285.05 million in Fiscal 2024, which was in line with an increase in lease liability, primary as a result of the renewal and conversion of lease agreements from short-term to long-term leases for our Bengaluru RDC, as well as the addition of one floor in our Noida corporate office.
Depreciation and amortisation expense
Our depreciation and amortisation expense remained stable at Rs3,803.57 million in Fiscal 2025 as compared to Rs3,643.69 million in Fiscal 2024.
Other expenses
Our other expenses increased by 12.19% to Rs37,136.32 million in Fiscal 2025 from Rs33,101.25 million in Fiscal 2024, which was primarily attributable to an increase in following expenses:
• Royalty. Our royalty expense increased by 12.74% to Rs4,546.10 million in Fiscal 2025 from Rs4,032.30 million in Fiscal 2024, which was in line with an increase in revenue in Fiscal 2025.
Sales promotion. Our sales promotion expense increased by 6.90% to Rs7,332.92 million in Fiscal 2025 from Rs6,859.56 million in Fiscal 2024, as a result of an increase in the number of sales promoters to 9,490 as of March 31, 2025 from 9,300 as of March 31, 2024 and the related expenses to engage promoters to support our growing sales network.
• Customer service. Our customer service expense increased by 23.13% to Rs2,893.98 million in Fiscal 2025 from Rs2,350.39 million in Fiscal 2024 primarily due to an increase in the parts sourced for our services business and other service-related expenses.
• Freight and forwarding. Our freight and forwarding expense increased by 14.28% to R s8,720.66 million in Fiscal 2025 from Rs7,630.72 million in Fiscal 2024, largely in line with an increase in volume of products sold.
Tax Expense from Continuing Operations
Our tax expense increased by 44.43% to Rs7,597.63 million in Fiscal 2025 from Rs5,260.49 million in Fiscal 2024, primarily due to an increase in our current tax expense, arising from the increase in profit before tax from continuing operations.
Profit for the Year from Continuing Operations
As a result of the foregoing factors, our profit for the year increased by 45.81% to Rs 22,033.48 million in Fiscal 2025 from ^15,110.68 million in Fiscal 2024.
Fiscal 2024 compared to Fiscal 2023
Income from Continuing Operations
Our total income increased by 7.20% to ^215,571.18 million in Fiscal 2024 from Rs 201,085.84 million in Fiscal 2023, primarily due to:
• an increase in the revenue from our Home Appliances and Air Solution Division by 4.32% to Rs156,797.49 million in Fiscal 2024 from Rs150,306.78 million in Fiscal 2023. This increase was due to an increase in the sales volume of our home appliances and air solution products sold, and related services rendered. In particular, our revenue from the sale of air conditioners and washing machines increased
with an increase in the demand for these products. While the sales volume of refrigerators increased in Fiscal 2024, the revenue generated from these sales decreased due to change in model mix in Fiscal 2024. For more details, see Our Business Model" on page 353.
• Our revenue from our Home Entertainment Division increased by 17.34% to Rs56,722.51 million in Fiscal
2024 from Rs48,339.15 million in Fiscal 2023. This increase was due to an increase in the sales volumes of our home entertainment products, in particular, televisions, and the increase in the selling price of other Home Entertainment products. The increase was partially offset by a reduction in the selling price of televisions aligned with the market trends in India, and a decrease in the costs of television display panels. For more details, see "- Our Business Model" on page 353.
Our revenue also increased with an increase in revenue from rendering services by 19.04% to Rs5,769.14 million in Fiscal 2024 from Rs4,846.26 million in Fiscal 2023. Our revenue from service income increased by 17.11% to Rs2,865.02 million in Fiscal 2024 from Rs2,446.40 million in Fiscal 2023 primarily due to an increase in the annual maintenance contracts entered into in Fiscal 2024 compared to Fiscal 2023 in line with an increase in the demand for such services. Further, our revenue from installations and commissioning increased by 21.01% to Rs2,904.12 million in Fiscal 2024 from Rs2,399.86 million in Fiscal 2023 primarily due to an increase in our sales volumes.
Our revenue from sale of stock-in-trade marginally increased to Rs23,488.07 million in Fiscal 2024 from Rs23,308.64 million in Fiscal 2023.
Our other operating revenue increased by 15.00% to Rs1,219.73 million in Fiscal 2024 from Rs1,060.63 million in Fiscal 2023, primarily due to an increase in government grants that related to increase in tax incentives earned for the Pune Manufacturing Unit; an increase in the sale of scrap as we increased our production volumes; and an increase in duty drawback and other export incentives.
Our other income decreased by 15.93% to Rs2,051.18 million in Fiscal 2024 from Rs2,439.91 million in Fiscal 2023, primarily due to a decrease in interest income on bank deposits as we did not make dividend payments due for the year in Fiscal 2023. The dividend payments due for Fiscal 2023 were paid to LG Electronics in Fiscal 2024.
Expenses from Continuing Operations
Cost of materials consumed
Our cost of materials consumed increased by 4.49% to Rs129,160.49 million in Fiscal 2024 from Rs123,608.20 million in Fiscal 2023, as we increased the quantum of raw materials sourced to support the increase in our production volumes in Fiscal 2024 compared to Fiscal 2023.
Purchases of stock-in-trade
Our purchases of stock-in-trade increased by 3.03% to Rs19,357.72 million in Fiscal 2024 from Rs18,787.63 million in Fiscal 2023, primarily due to an increase in demand for such products.
Employee benefits expense
Our employee benefit expenses increased by 10.97% to Rs8,868.24 million in Fiscal 2024 from Rs7,991.56 million in Fiscal 2023, primarily due to an increase in our employee base from 3,596 as of March 31, 2023 to 3,705 as of March 31, 2024, including employees at senior levels, which caused an increase in salaries, wages and bonus.
Changes in inventories of finished goods, stock-in-trade and work-in-progress
Our changes in inventories decreased to Rs783.57 million in Fiscal 2024 from ^(2,115.10) million in Fiscal 2023 primarily due to an increase in the opening inventories which was partially offset by a decrease in the closing inventories of finished goods, primarily due to early onset of monsoons in Fiscal 2023 which led to an increase in stock of air conditioners in Fiscal 2023.
Finance costs
Our finance costs increased by 26.22% to Rs285.05 million in Fiscal 2024 from Rs225.84 million in Fiscal 2023, primarily due to an increase in interest on lease liabilities to Rs269.42 million in Fiscal 2024 from Rs225.03 million
in Fiscal 2023, which was due to an increase in premises leased to support our sales and supply operations. We also incurred an interest cost for delayed payments of custom duties in Fiscal 2024 for mobile phones imported from Vietnam into India in previous years as certain benefits applicable to us under the free trade agreements with countries were disallowed.
Depreciation and amortisation expense
Our depreciation and amortisation expense increased by 21.30% to Rs3,643.69 million in Fiscal 2024 from Rs3,003.93 million in Fiscal 2023, primarily due to an increase in depreciation of owned assets to Rs2,829.52 million in Fiscal 2024 from Rs2,350.07 million in Fiscal 2023 and an increase in depreciation of right of use assets to Rs770.82 million in Fiscal 2024 from Rs615.92 million in Fiscal 2023. The increase was primarily driven by the purchase of assets to support our operations for our manufacturing operations.
Other expenses
Our other expenses increased by 5.48% to Rs33,101.25 million in Fiscal 2024 from Rs31,380.49 million in Fiscal 2023, which was primarily attributable to an increase in following expenses:
• Royalty. Our royalty expense increased by 24.74% to Rs4,032.30 million in Fiscal 2024 from Rs3,232.44 million in Fiscal 2023, in line with an increase in revenue in Fiscal 2024.
• Sales promotion. Our sales promotion expense increased by 10.13% to Rs6,859.56 million in Fiscal 2024 from Rs6,228.36 million in Fiscal 2023, as a result of an increase in the number of sales promoters from 9,193 as of March 31, 2023 to 9,300 as of March 31, 2024 and the related expenses to engage promoters to support our growing sales network.
• Customer service. Our customer service expense increased by 21.81% to Rs2,350.39 million in Fiscal 2024 from Rs1,929.50 million in Fiscal 2023 primarily due to an increase in the parts sourced for our services business and other service-related expenses.
• Freight andforwarding. Our freight and forwarding expense increased by 3.88% to Rs7,630.72 million in Fiscal 2024 from Rs7,345.89 million in Fiscal 2023, largely in line with an increase in volume of products sold.
This increase in other expenses was partially offset by a decrease in loss on foreign currency transactions and translation (net) by 75.90% to Rs260.35 million in Fiscal 2024 from Rs1,080.21 million in Fiscal 2023, as a result of appreciation of the Indian rupee against the US dollar in Fiscal 2024.
Tax Expense from Continuing Operations
Our tax expense increased by 11.38% to Rs5,260.49 million in Fiscal 2024 from Rs4,723.09 million in Fiscal 2023, primarily due to an increase in our current tax expense, arising from the increase in profit before tax from continuing operations.
Profit for the Year from Continuing Operations
As a result of the foregoing factors, our profit for the year increased by 12.35% to ^15,110.68 million in Fiscal 2024 from Rs13,449.30 million in Fiscal 2023.
Non-GAAP Financial Measures
In addition to our results determined in accordance with Ind AS, we believe the following non-GAAP measures are useful to investors in evaluating our operating performance. We use the following non-GAAP financial information to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that non-GAAP financial information, when taken collectively with financial measures prepared in accordance with Ind AS, may be helpful to investors because it provides an additional tool for investors to use in evaluating our ongoing operating results and trends and in comparing our financial results with other companies in our industry because it provides consistency and comparability with past financial performance. However, our management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with Ind AS.
Non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with Ind AS. Non-GAAP financial information may be different from similarly titled non-GAAP measures used by other companies. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by Ind AS to be recorded in our financial statements, as further detailed below. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these Non- Ind AS financial measures. A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure prepared in accordance with Ind AS. Investors are encouraged to review the related Ind AS financial measures and the reconciliation of non-GAAP financial measures to their most directly able Ind AS financial measures included below and to not rely on any single financial measure to evaluate our business.
EBITDA, EBITDA Margin, Net Profit Margin
The following table reconciles EBITDA, EBITDA Margin and Net Profit/(Loss) Margin to profit for the period/year.
• EBITDA is calculated as profit for the period / year plus total tax expense plus finance costs plus depreciation and amortization minus other income
• EBITDA Margin is calculated as EBITDA as a percentage of revenue from operations (including continuing and discontinued operations).
• Net Profit Margin is defined as profit for the period/year as a percentage of total income.
| Particulars | Three months ended June 30, | Fiscal | |||
| 2025 | 2024 | 2025 | 2024 | 2023 | |
Rs million except % |
|||||
| Total income | 63,373.64 | 64,667.97 | 246,306.28 | 215,571.18 | 201,122.30* |
| Revenue from operations | 62,629.38 | 64,087.97 | 243,666.38 | 213,520.00 | 198,682.39* |
| Profit for the period / year | 5,132.55 | 6,796.46 | 22,033.48 | 15,110.68 | 13,449.30 |
| Add: Tax expenses** | 1,787.00 | 2,327.64 | 7,597.63 | 5,260.49 | 4,711.99 |
| Add: Depreciation and | 902.41 | 967.21 | 3,803.57 | 3,643.69 | 3,003.93 |
| amortisation expense | |||||
| Add: Finance costs | 85.03 | 69.35 | 306.46 | 285.05 | 225.84 |
| Less: Other Income** | 744.26 | 580.00 | 2,639.90 | 2,051.18 | 2,439.91* |
| EBITDA | 7,162.73 | 9,580.66 | 31,101.24 | 22,248.73 | 18,951.15 |
| EBITDA Margin | 11.44% | 14.95% | 12.76% | 10.42% | 9.54% |
| Net Profit Margin | 8.10% | 10.51% | 8.95% | 7.01% | 6.69% |
*includes total income and revenue from operations for both continuing and discontinued operations ** includes continuing and discontinued operations
Return on Capital Employed
Return on Capital Employed is EBITDA less depreciation and amortization, divided by capital employed. Capital employed is calculated as total equity plus total borrowings, total lease liabilities less amalgamation reserves. EBIT is calculated as profit before tax plus finance costs minus other income. The table below reconciles Return on Capital Employed to total equity and profit before tax including discontinued operations for the periods/years indicated:
| Three months ended June 30, | Fiscal | ||||
| Particulars | 2025 | 2024 | 2025 | 2024 | 2023 |
| Rs million except % | |||||
| Total equity* (A) | 64,478.48 | 44,163.40 | 59,337.45 | 37,358.21 | 43,198.20 |
| Lease liabilities (B) | 4,343.69 | 3,585.95 | 4,278.28 | 3,699.55 | 3,184.51 |
| Capital Employed (A+B) | 68,822.17 | 47,749.35 | 63,615.73 | 41,057.76 | 46,382.71 |
| Profit before tax including discontinued operations (C | 6,919.55 | 9,124.10 | 29,631.11 | 20,371.17 | 18,161.29 |
| Particulars | Three months ended June 30, | Fiscal | |||
| 2025 | 2024 | 2025 | 2024 | 2023 | |
Rs million except % |
|||||
| Finance costs (D) | 85.03 | 69.35 | 306.46 | 285.05 | 225.84 |
| Other income** (F) | 744.26 | 580.00 | 2,639.90 | 2,051.18 | 2,439.91 |
| EBIT (C+D-F) | 6,260.32 | 8,613.45 | 27,297.67 | 18,605.04 | 15,947.22 |
| Return on Capital employed (EBIT / Capital Employed) | 9.10% | 18.04% | 42.91% | 45.31% | 34.38% |
*excluding amalgamation reserve
**includes continuing and discontinued operations
Return on Net Worth
Return on Net Worth is calculated as profit for the year attributable to equity shareholders of our Company divided by net worth of our Company as at the end of the period / year. Equity attributable to equity holders of the parent is defined as equity share capital (excluding amalgamation reserve) plus other equity. The table below reconciles Return on Net Worth to profit for the year/period:
| Three months ended June 30, | Fiscal | ||||
| Particulars | 2025 | 2024 | 2025 | 2024 | 2023 |
Rs million except % |
|||||
| Equity share capital (A) | 6,787.72 | 1,131.29 | 6,787.72 | 1,131.29 | 1,131.29 |
| Other equity (B) | 58,055.01 | 43,396.36 | 52,913.98 | 36,591.17 | 42,431.16 |
| Amalgamation Reserve (C) | (364.25) | (364.25) | (364.25) | (364.25) | (364.25) |
| Equity attributable to equity holders of the parent (D=A+B+C) | 64,478.48 | 44,163.40 | 59,337.45 | 37,358.21 | 43,198.20 |
| Profit for the period / year (E) | 5,132.55 | 6,796.46 | 22,033.48 | 15,110.68 | 13,449.30 |
| Return on Net Worth (F=E/D) | 7.96% | 15.39% | 37.13% | 40.45% | 31.13% |
Free Cash Flow ("FCF"), FCF Margin
FCF is calculated as net cash flow from or used in operating activities minus capital expenditures. FCF Margin is calculated as FCF as a percentage of revenue from operations. The table below details the calculation of FCF and FCF Margin for the year/period:
| Three months ended June 30, | Fiscal | ||||
| Particulars | 2025 | 2024 | 2025 | 2024 | 2023 |
| Rs million except % | |||||
| Net Cash Inflow from | 9,418.90 | 14,046.84 | 16,538.92 | 16,654.61 | 18,708.28 |
| Operating Activities (CFO) | |||||
| Purchase of property, plant and equipment and intangible assets (including Capital work- in-progress and Intangible assets under development) (A) | 1,612.26 | 520.07 | 3,393.26 | 2,421.25 | 5,171.04 |
| Less: Proceeds from sale | 0.64 | 3.92 | 47.70 | 19.14 | 32.94 |
| of property, plant and equipment (PP&E) (B) | |||||
| Net Capex (A-B) | 1,611.62 | 516.15 | 3,345.56 | 2,402.11 | 5,138.10 |
| Free Cash Flow (CFO - Net capex) | 7,807.28 | 13,530.69 | 13,193.36 | 14,252.50 | 13,570.18 |
| Free Cash Flow Margin i.e. ( Free Cash Flow/ | 12.47% | 21.11% | 5.41% | 6.68% | 6.83% |
| Three months ended June 30, | Fiscal | ||||
| Particulars | 2025 | 2024 | 2025 | 2024 | 2023 |
Rs million except % |
|||||
| Revenue from Operations*) | |||||
includes total income and revenue from operations for both continuing and discontinued operations
Working Capital Days
Working capital days are calculated by adding receivable days, which are determined by dividing average receivables by revenue from operations and multiplying by 365, to inventory days, which are calculated by dividing average inventory by the cost of goods sold and multiplying by 365, and then subtracting payable days, which are determined by dividing average payables by the cost of goods sold and multiplying by 365. The table below details the calculation of working capital days for the year/period:
| Particulars | Three months ended June 30, | Fiscal | |||
| 2025 | 2024 | 2025 | 2024 | 2023 | |
| Average Trade Receivables ( Rs million) | 19,297.68 | 15,147.12 | 20,790.96 | 16,482.76 | 14,402.90 |
| Receivables Days (Average Receivables * Number of days in period / Revenue from operations) (number of days) | 28.04 | 21.51 | 31.14 | 28.18 | 26.46 |
| Average Inventories ( Rs million) | 30,303.76 | 23,272.41 | 27,144.37 | 25,192.24 | 25,252.35 |
| Inventories Days (Average Inventories * Number of days in period / Cost of goods sold) (number of days) | 64.38 | 49.45 | 59.76 | 61.59 | 65.70 |
| Average Trade Payables ( Rs million) | 31,490.26 | 29,502.15 | 31,713.29 | 30,193.98 | 28,012.00 |
| Payables Days (Average Payables * Number of days in period / Cost of goods sold) (number of days) | 66.90 | 62.69 | 69.81 | 73.82 | 72.89 |
| Working Capital Days (Receivables Days + Inventory Days - Payables Days) (number of days) | 25.52 | 8.27 | 21.09 | 15.95 | 19.28 |
Liquidity and Capital Resources
Historically, our primary liquidity requirements have been to finance our working capital needs for our operations. We have met these requirements through cash flows from operations and equity infusions from shareholders. As of June 30, 2025, we had balance with banks of Rs 1,477.38 million, cash on hand of Rs 8.83 million and bank deposits with original maturity of less than three months of Rs 44,263.04 million.
We believe that, after considering the expected cash to be generated from operations and any equity investments, we will have sufficient liquidity for our present requirements and anticipated requirements for capital expenditure, including in relation to setting up of a new manufacturing unit in Andhra Pradesh, and working capital will be sufficient to meet our working capital and capital expenditures needs for at least the next 12 months and beyond.
Our future capital requirements will depend on many factors, including, but not limited to our growth, our ability to attract and retain trade partners and consumers, increase our product development capabilities in India, expand our operations by deepening our presence in India, address consumer concerns quickly, and implement new technologies in operations. Further, we may in the future enter into arrangements to strategically pursue inorganic growth opportunities to support our operations. We may finance our capital requirements through equity, debt, or a combination thereof.
Cash Flows
The table below summarizes the statement of cash flows, as per our restated consolidated cash flow statements, for the years and periods/years indicated:
| Three months ended June 30, | Fiscal | ||||
| Particulars | 2025 | 2024 | 2025 | 2024 | 2023 |
Rs million |
|||||
| Operating profit before change in operating assets and liabilities | 7,213.41 | 9,674.33 | 31,102.97 | 22,485.73 | 19,318.69 |
| Net cash inflow from operating activities | 9,418.90 | 14,046.84 | 16,538.92 | 16,654.61 | 18,708.28 |
| Net cash (outflow)/inflow from investing activities | (770.46) | 41.27 | (275.45) | (204.57) | (2,740.00) |
| Net cash from financing activities | (301.81) | (255.36) | (1,064.54) | (21,852.53) | (25,607.31) |
| Cash and cash equivalents at the end of the year | 45,749.25 | 36,060.72 | 37,414.73 | 22,226.05 | 27,625.88 |
Operating Activities
Our net cash inflow from operating activities in the three months ended June 30, 2025 was Rs9,418.90 million, while our operating profit before change in operating assets and liabilities was ^7,213.41 million. Such difference was primarily attributable to a decrease in trade receivable of Rs8,682.75 million, a decrease in other assets of Rs410.96 million and a decrease of other financial assets of Rs203.41 million, partially offset by a decrease in trade payable of Rs4,384.71 million, a decrease in other liabilities Rs1,664.49 million and net income tax paid of Rs1,206.06 million
Our net cash inflow from operating activities in the three months ended June 30, 2024 was Rs14,046.84 million, while our operating profit before change in operating assets and liabilities was Rs9,674.33 million. Such difference was primarily attributable to a decrease in trade receivables of Rs5,688.24 million and a decrease in inventories of Rs1,403.55 million. This was partially offset by net income tax paid of Rs1,045.80 million, a decrease in other liabilities of Rs687.71 million and an increase in other assets of Rs420.18 million.
Our net cash inflow from operating activities in Fiscal 2025 was Rs16,538.92 million, while our operating profit before change in operating assets and liabilities was Rs31,102.97 million. Such difference was primarily attributable to net income tax paid of Rs7,538.73 million, an increase in inventories of Rs6,340.37 million, an increase in trade receivables of Rs5,711.48 million and an increase in other assets ^1,154.45 million, partially offset by an increase in trade payables of Rs4,153.17 million and an increase in other liabilities of Rs1,793.84 million.
Our net cash inflow from operating activities in Fiscal 2024 was Rs16,654.61 million, while our operating profit before change in operating assets and liabilities was Rs22,485.73 million. Such difference was primarily attributable to net income tax paid of Rs5,698.50 million, an increase in trade receivables of Rs2,946.03 million and a decrease in trade payables of Rs949.38 million. This was partially offset by a decrease in inventories of Rs2,468.08 million and an increase in other liabilities of Rs1,327.05 million.
Our net cash inflow from operating activities in Fiscal 2023 was Rs18,708.28 million, while our operating profit before change in operating assets and liabilities was ^19,318.69 million. Such difference was primarily attributable to net income tax paid of Rs4,424.75 million, an increase in inventories of Rs2,262.02 million and an increase in trade receivables of Rs1,206.40 million. This was partially offset by an increase in trade payables of Rs5,265.23 million, an increase in other liabilities of Rs1,001.76 million and an increase in other financial liabilities of Rs832.57 million.
Investing A ctivities
Our net cash outflow from investing activities in the three months ended June 30, 2025 was Rs 770.46 million, which consisted of purchase of property, plant and equipment and intangible assets (including capital work-in- progress and intangible assets under development) of Rs1,612.26 million, partially offset by interest income on bank deposits of Rs728.72 million and proceeds from government grant of Rs112.44 million.
Our net cash inflow from investing activities in the three months ended June 30, 2024 was Rs41.27 million, which consisted of interest income on bank deposits of Rs557.42 million, partially offset by purchase of property, plant and equipment and intangible assets (including capital work-in-progress and intangible assets under development) of Rs520.07 million.
Our net cash outflow from investing activities in Fiscal 2025 was Rs 275.45 million, which consisted of purchase of property, plant and equipment and intangible assets (including capital work-in-progress and intangible assets under development) of Rs3,393.26 million, partially offset by interest income on bank deposits of Rs2,476.99 million and proceeds from government grant of Rs593.12 million.
Our net cash outflow from investing activities in Fiscal 2024 was Rs204.57 million, which consisted of purchase of property, plant and equipment and intangible assets (including capital work-in-progress and intangible assets under development) of Rs2,421.25 million, partially offset by interest income on bank deposits of Rs1,989.48 million and proceeds from government grant of Rs208.06 million.
Our net cash outflow from investing activities in Fiscal 2023 was Rs2,740.00 million, which consisted of purchase of property, plant and equipment and intangible assets (including capital work-in-progress and intangible assets under development) of Rs5,171.04 million, partially offset by interest income on bank deposits of Rs2,201.51 million and proceeds from government grant of Rs196.59 million.
Financing Activities
Our net cash outflow from financing activities in the three months ended June 30, 2025 was Rs 301.81 million, which consisted of principal payment of lease liabilities of Rs216.78 million and interest paid on lease liabilities of Rs85.03 million.
Our net cash outflow from financing activities in the three months ended June 30, 2024 was Rs255.36 million, which consisted of principal payment of lease liabilities of Rs186.01 million and interest paid on lease liabilities of Rs69.35 million.
Our net cash outflow from financing activities in Fiscal 2025 was Rs1,064.54 million, which consisted of principal payment of lease liabilities of Rs759.95 million and interest paid on lease liabilities of Rs304.59 million.
Our net cash outflow from financing activities in Fiscal 2024 was Rs21,852.53 million, which consisted of interim dividend of Rs20,928.82 million (paid in the third quarter of Fiscal 2024), principal payment of lease liabilities of Rs654.29 million and interest paid on lease liabilities of Rs269.42 million.
Our net cash outflow from financing activities in Fiscal 2023 was Rs25,607.31 million, which consisted of interim dividend of Rs24,888.32 million, principal payment of lease liabilities of Rs493.96 million and interest paid on lease liabilities of Rs225.03 million.
Contractual Obligations
The table below sets forth our contractual obligations with definitive payment terms as of June 30, 2025. These obligations primarily relate to our trade payables. Our trade payables primarily relate to the purchase of raw materials and stock-in-trade, as well as other services such as marketing activities involving third-party marketing agencies and freight.
| Particulars | Less than one year | 1-5 years | More than 5 years | Total |
Rs million |
||||
| Non-derivatives | ||||
| Trade payables | 29,309.38 | - | - | 29,309.38 |
| Particulars | Less than one year | 1-5 years | More than 5 years | Total |
Rs million |
||||
| Other financial liabilities | 4,731.31 | - | - | 4,731.31 |
| Lease liabilities | 1,039.41 | 2,657.45 | 1,943.94 | 5640.80 |
| Derivatives | ||||
| Derivative financial liabilities | 13.87 | - | - | 13.87 |
| Total | 35,093.97 | 2,657.45 | 1,943.94 | 39,695.36 |
Contingent Liabilities
A) The following table sets forth the principal components of claims against the Company not acknowledged as debt (to the extent not specifically provided for) as of June 30, 2025 and 2024 and as of March 31, 2025, 2024 and 2023.
| Particulars | As of June 30, | As of March 31, | |||
| 2025 | 2024 | 2025 | 2024 | 2023 | |
| Rs million | |||||
| Claims against the Company not acknowledged as debt # | |||||
| (a) Demand notices from Central Excise/ Service Tax/ Customs Department: | |||||
| Total demand | 2,069.30 | 2,069.30 | 2,067.44 | 2,250.82 | 2,242.99 |
| Less: Provision | 114.29 | 111.88 | 112.43 | 110.01 | 102.51 |
| Total | 1,955.01 | 1,957.42 | 1,955.01 | 2,140.81 | 2,140.48 |
| (b) Demand notices from Sales Tax Department / goods and services tax ("GST") Department: | |||||
| Total demand | 3,331.32 | 2,897.43 | 3,353.24 | 3,125.20 | 1,160.27 |
| Less: Provision | 53.33 | 53.33 | 53.33 | 53.33 | 53.33 |
| Total | 3,277.99 | 2,844.10 | 3,299.91 | 3,071.87 | 1,106.94 |
| (c) Demand from Income Tax Department: | |||||
| Total demand | 23,393.70 | 21,928.47 | 23,485.13 | 22,500.43 | 22,198.00 |
| Less: Provision | 1,985.12 | 1,985.12 | 1,985.12 | 1,985.12 | 1,985.12 |
| Total | 21,408.58 | 19,943.35 | 21,500.01 | 20,515.31 | 20,212.88 |
| (d) Other claims | 328.81 | 256.81 | 320.19 | 275.94 | 253.73 |
| Less: Provision | 76.96 | 75.24 | 76.53 | 74.82 | 72.67 |
| Total | 251.85 | 181.57 | 243.66 | 201.12 | 181.06 |
| Total demands | 29,123.13 | 27,152.01 | 29,226.00 | 28,152.39 | 25,854.99 |
| Less: Provision | 2,229.70 | 2,225.57 | 2,227.41 | 2,223.28 | 2,213.63 |
| Grand total | 26,893.43 | 24,926.44 | 26,998.59 | 25,929.11 | 23,641.36 |
# Notes:
i) Based on the interpretation of the provisions of applicable Acts and in respect of other legal cases, we are of the opinion that the above demands are likely to be deleted or substantially reduced and accordingly no additional pro-vision has been made.
ii) Excludes show cause notices replied by us. We have not yet heard from the appropriate authorities in the matter and is of the view that same are not contingent in nature.
iii) It is not practical for us to estimate the timing of cash outflows, if any, in respect of the above, pending resolution of the respective proceedings.
iv) During the year ended March 31, 2019, we had evaluated the impact ofthe Supreme Court Judgment in case of "Vivekananda Vidyamandir and Others vs The Regional Provident Fund Commissioner (II) West Bengal" and the related circular (Circular No. C- 1/1(33)2019/Vivekananda Vidya Mandir/284) dated March 20, 2019 issued by the Employees Provident Fund Organization in relation to non-exclusion of certain allowances from the definition of "basic wages" of the relevant employees for the purposes of determining contribution to provident fund under the Employees Provident Funds & Miscellaneous Pro-visions Act, 1952. In the assessment of the management which was supported by legal advice, the aforesaid matter was not likely to have a significant impact and accordingly, no provision has been made in the financial statements.
v) Amounts are as per demand order and include penalty and interest, wherever applicable.
B) Contingency on advance pricing agreement of royalty
The Company had accrued royalty expense and paid Rs 1,175.02 million, Rs 1,215.08 million, Rs 4,546.10 million, Rs 4,032.30 million and Rs 3,232.44 million for the three months periods ended June 30, 2025 and June 30, 2024 and years ended March 31, 2025, March 31, 2024 and March 31, 2023, respectively to its holding company, i.e. LG
Electronics Inc., South Korea, (The Holding Company), for the use of technology and brand name. The royalty was determined in accordance with the revised license agreement dated July 27, 2017, which was effective from April 1, 2016, as amended from time to time, between the Company and its holding company.
The revised license agreement also provided for additional payment of royalty, which was contingent upon the approval of the application dated March 28, 2018 for Advance Pricing Agreement (‘APA) filed with the income- tax authorities in India and the Republic of Korea. The period of APA expired on March 31, 2023 and thereafter an application for extension was filed on March 31, 2023 covering the Fiscal 2024 to 2028. The possible obligation arising from additional royalty payments based on the aforesaid revised license agreement amounting to Rs71,594.98 million, Rs67,436.64 million and Rs59,866.92 million was disclosed as contingent liability as at June 30, 2024, March 31, 2024 and March 31, 2023, respectively.
On May 8, 2024, the Company and its holding company, filed a Mutual Agreement Procedure (‘MAP) application with the respective Competent Authority of India and the Republic of Korea, under Article 25(1) of the comprehensive agreements between India and the Republic of Korea to resolve the consequences of double taxation arising from certain transfer pricing tax adjustments made by the tax authority of the Republic of Korea on the holding company.
The Company entered into an addendum on November 18, 2024 to the aforesaid revised license agreement, aligning its royalty obligation to the amount accrued and paid for the respective years and updated its APA application accordingly. The Company has withdrawn the APA extension application dated March 31, 2023 through its filing with the Income-tax authority in India on November 20, 2024. Pursuant to the addendum dated November 18, 2024 and pending approval of the MAP application, the contingent liability determined as of June 30, 2025 is Rs3,153.00 million.
Subsequent to June 30, 2025, the Tax Authorities of India shared a draft of the Mutual Agreement proposed to be signed between the Competent authorities of India and Republic of Korea (‘Proposed MA) with the Company on July 28, 2025. The Company agreed to the terms of the Proposed MA on August 5, 2025, and consequently the Company has received a draft APA on similar lines as the Proposed MA, from Tax Authorities of India on August 21, 2025 which would cover the period of nine years from April 1, 2014 to March 31, 2023. The Company is in the process of reviewing the terms of the APA and the execution of the APA is subject to acceptance of the terms and conditions mentioned therein.
See "Risk Factors - The royalty payments made by us to our Promoter under the License Agreement or otherwise may attract regulatory scrutiny or action. As of the date of this Red Herring Prospectus, we have a contingent liability of t.3,153.00 million in respect of royalty payments to our Promoter. There is no assurance that such observations will not be raised by the tax authorities in respect of future periods, which could then have an adverse impact on our results of operations on page 39.
Capital Expenditures
Our historical capital expenditures were, and we expect our future capital expenditures to be, primarily for enhancing our production facilities and upgrading equipment and manufacturing processes in order to increase our manufacturing capacity utilization. The following table provides our capital expenditure costs incurred for the periods/years indicated. For more details see, " - Principal Factors Affecting our Financial Condition and Results of Operations - Capital Expenditure and Production Capacity" on page 360.
| Particulars | Three months ended June 30, | Fiscal | ||||||||
| 2025 | 2024 | 2025 | 2024 | 2023 | ||||||
Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operations* | Rs million |
% of revenue from operation* | Rs million |
% of revenue from operations* | |
| Capital expenditure (unallocable) | 1,902.73 | 3.04% | 731.01 | 1.14% | 5,320.97 | 2.18% | 3,616.00 | 1.69% | 5,424.00 | 2.73% |
* includes revenue from continuing and discontinued operations
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements, derivative instruments or other relationships with other entities that would have been established for the purpose of facilitating off-balance sheet arrangements.
Related Party Transactions
We enter into various transactions with related parties. For further information see " Other Financial Information - Related Party Transactions" on page 352 of this Red Herring Prospectus.
Significant Economic Changes
Other than as described in "Our Business " on page 189, to the knowledge of our management, there are no other significant economic changes that materially affect or are likely to affect income from continuing operations.
Unusual or Infrequent Events of Transactions
Except as described in this Red Herring Prospectus, there have been no other events or transactions that, to our knowledge, may be described as "unusual" or "infrequent".
Known Trends or Uncertainties
Our business has been affected and we expect will continue to be affected by the trends identified above "- Principal Factors Affecting our Financial Condition and Results of Operations on page 357 and the uncertainties described in "Risk Factors on page 38. To our knowledge, except as described or anticipated in this Red Herring Prospectus, there are no known factors which we expect will have a material adverse impact on our revenues or income from continuing operations.
Seasonality of Business
The sales volumes of some of our products are influenced by the cyclicality and seasonality of demand for our products in India. For further details, see "- Principal Factors Affecting our Financial Condition and Results of Operations - Seasonality" and "Risk Factors - Our business is seasonal in nature and a decrease in our sales during some quarters could have an adverse impact on our financial performance" on pages 362 and 80, respectively.
Competitive Conditions
We operate in several business segments in different industries with multiple product and service categories and face a broad range of competition from existing and new competitors ranging from large multinational companies to highly specialized entities that focus on a limited number of products and services, according to the Redseer Report. Our existing and future competitors may have significantly greater financial resources that can be devoted to design, development, manufacturing, marketing, sales, and support of their products. They may also have technical and manufacturing capabilities and/or marketing, retail and service network and brand recognition that is comparable to, or more developed than, our own. For further details, see "Principal Factors Affecting our Financial Condition and Results of Operations - Competition and our ability to introduce new products for the Indian market" on page 358 and "Risk Factors - We may not be able to compete successfully in the highly competitive, price sensitive and fast evolving home appliances and consumer electronics markets (including from foreign players as well as online-first brands players) which could have an adverse impact on our operations" on page 49.
New Products or Business Segments Expected
Except as disclosed in "Our Business" on page 189, and products that we announce in the ordinary course of business, we have not announced and do not expect to announce in the near future any new products or business segments.
Significant Dependence on Single or Few Trade Partners, Consumers or Suppliers
We largely depend on a single logistics partner for warehousing and logistics chain management. For further details, see "Risk Factors - We primarily depend on LX Pantos for our transportation and warehouse logistics. Any failure by them to provide their service to us could have a material impact on our operations." on page 70. While we generally source most of our raw materials from multiple suppliers, we depend on a limited number of suppliers for some of our key raw materials. For example, we depend on three steel manufacturers in India for pre-coated and galvanized steel; we source majority of our acrylonitrile butadiene styrene resin and expanded polystyrene resin from two suppliers; and a majority of internally grooved tubes from a single supplier. For further details, see "Risk Factors - Our top-five suppliers and top-10 suppliers contributed 22.08% and 32.25% of our total purchases of raw materials, including components, in the three months ended June 30, 2025, respectively. Further, we source certain raw materials from suppliers in select countries outside India. Any interruption in the availability of raw materials due to geopolitical uncertainties, shortages or supplier misconduct, among other reasons, could adversely impact our business operations" on page 42.
Future Relationship Between Cost and Income
Other than as described elsewhere in this Red Herring Prospectus, to the knowledge of our management, there are no known factors that might affect the future relationship between costs and revenues.
Auditor Observations
Our Statutory Auditor has noted an emphasis of matter in their auditor reports for the financial statements as of and for the years ended March 31, 2024 and 2023, as highlighted in the table:
| Period | Emphasis of matters |
| Fiscal 2024 | We draw your attention to Note 32 to the accompanying financial statements, where it is stated that the Company had entered into a Revised License Agreement dated July 27, 2017 with its parent Company, i.e., LG Electronics Inc., Republic of Korea, for the use of technology and brand name. In accordance with the aforesaid agreement, the Company is liable to pay royalty to LG Electronics Inc., Republic of Korea. Based on the original agreement, royalty amounting to Rs4,032 million has been accrued during the year ended March 31, 2024, and remaining portion of royalty based on the aforesaid Revised License Agreement amounting to Rs67,437 million pertaining to the period from April 1, 2016 to March 31, 2024 is contingent upon conclusion of the Advance Pricing Agreement with the Government of India. Consequently, the Company has not accrued the remaining portion and the obligation has been disclosed as a contingent liability. |
| Fiscal 2023 | We draw your attention to Note 32 to the accompanying financial statements, where it is stated that the Company had entered into a Revised License Agreement dated July 27, 2017 with its parent Company, i.e., LG Electronics Inc., South Korea, for the use of technology and brand name. In accordance with the aforesaid agreement, the Company is liable to pay royalty to LG Electronics Inc., South Korea. Based on the original agreement, royalty amounting to Rs3,232 million has been accrued during the year ended March 31, 2023, and remaining portion of royalty based on the aforesaid Revised License Agreement amounting to Rs59,867 million pertaining to the period from April 1,2016 to March 31,2023 is contingent upon conclusion of the Advance Pricing Agreement with the Government of India. Consequently, the Company has not accrued the remaining portion and the obligation has been disclosed as a contingent liability. |
Please also see "Risk Factors - Our Statutory Auditors report for the financial statements as of and for the years ended March 31, 2024 and 2023 include observations with respect to the contingent liabilities arising from the License Agreement" on page 87.
Quantitative and Qualitative Disclosures about Market Risks
Market Risk
Foreign exchange risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. We are mainly exposed to foreign exchange risk on the US Dollar. For further details, see "Risk Factors - Foreign exchange rate fluctuations can adversely affect our financial results due to sales and expenses in different currencies and the value of our Equity Shares." on page 63.
The purpose of foreign exchange risk management is to provide the foundation of stable business operations by minimizing the uncertainty and volatility of foreign exchange gains and losses from foreign exchange rate fluctuations.
We have our own foreign exchange policy through which we minimize the exposure to foreign exchange risk by netting off foreign exchange assets and liabilities from general operating activities. We consider foreign exchange risk hedges against our remaining exposure with derivative financial instruments and scrutinize changes in foreign exchange exposure and the results of hedging activities on a monthly basis. Speculative foreign exchange trading is prohibited.
For more details on derivative instruments and unhedged foreign currency exposure, see "Restated Financial Information - Note 37 - Details on derivatives instruments and unhedged foreign currency exposure" on page 328.
Sensitivity
The sensitivity of profit or loss due to changes in exchange rates arises mainly from US Dollar denominated financial assets or liabilities. The following table sets forth the impact on profit and loss due to increase or decrease of foreign currency against the Indian rupee. Impact on other components of equity is nil.
| Particulars | Impact on profit before tax | ||||
| June 30, 2025 | June 30, 2024 | March 31, 2025 | March 31, 2024 | March 31, 2023 | |
| Foreign currency sensitivity Trade receivables | |||||
| Increase by 10%* | 157.84 | 221.77 | 214.13 | 210.55 | 267.18 |
| Decrease by 10%* | (157.84) | (221.77) | (214.13) | (210.55) | (267.18) |
| Other receivables | |||||
| Increase by 10%* | 9.27 | 4.80 | 9.38 | 8.53 | 5.33 |
| Decrease by 10%* | (9.27) | (4.80) | (9.38) | (8.53) | (5.33) |
| EEFC | |||||
| Increase by 10%* | 20.96 | 50.41 | 62.16 | 46.01 | 34.41 |
| Decrease by 10%* | (20.96) | (50.41) | (62.16) | (46.01) | (34.41) |
| Trade payables | |||||
| Increase by 10%* | (1,114.63) | (1,385.77) | (1220.09) | (1,384.58) | (1,471.53) |
| Decrease by 10%* | 1,114.63 | 1,385.77 | 1220.09 | 1,384.58 | 1,471.53 |
| Net impact | |||||
| Increase by 10%* | (926.56) | (1,108.79) | (934.42) | (1,119.49) | (1,164.61) |
| Decrease by 10%* | 926.56 | 1,108.79 | 934.42 | 1,119.49 | 1,164.61 |
*Keeping all other variables constant
Interest rate risk
We are not exposed to significant interest rate risk as at the respective reporting dates.
Credit Risk
Credit risk arises from the possibility that the counterparty will default on its contractual obligations resulting in financial loss to us. To manage this, the management periodically analyses historical bad debts and ageing of accounts receivable. We have secured the credit risk against the trade receivables through credit insurance.
For other financial assets, we consider the probability of default upon initial recognition of assets and whether there has been a significant increase in credit risk on an ongoing basis through each reporting period. To assess whether there is significant increase in credit risk, we do reasonable analysis of counterpartys financial capability based on following information:
(i) Actual or expected significant adverse changes in business;
(ii) Financial or economic conditions that are expected to cause a significant change to the counterpartys ability to meet its obligation;
(iii) Significant increase in credit risk and other financial instruments of the same counterparty; and
(iv) Significant changes in the value of collateral supporting the obligation or in the quality of third party guarantees or credit enhancements.
The expected credit loss on security deposits, bank balances / deposits and government grants has been determined to be immaterial.
Our credit period generally ranges from 0-30 days. Considering the large number of customers to which we sale, the credit risk in trade receivables is not concentrated in a single / few customers. We have performed an analysis of historical bad debts and has used the provision matrix approach to determine expected credit loss on such receivables. The expected credit loss on trade receivables as of June 30, 2025 and 2024, March 31, 2025, March 31, 2024 and March 31, 2023 is determined to be not material.
Liquidity Risk
The liquidity risk encompasses any risk that we cannot fully meet our financial obligations. To manage the liquidity risk, cash flow forecasting is performed by finance team. Our finance team monitors rolling forecasts for our liquidity requirements to ensure we have sufficient cash to meet operational needs and so that we do not breach borrowing limits or covenants (where applicable) on any of our borrowing facilities.
Material Accounting Policies and Use of Judgements and Estimates
A full description of our material accounting policies adopted in the preparation of our Restated Financial Information is provided in Note 2.3 to our Restated Financial Information. See "Restated Financial Information - Note 2.2 Critical estimates and judgments" and "Restated Financial Information - Note 2.3 Material accounting policies " on pages 280 and 281, respectively. Critical estimates and judgments and the critical accounting policies that our management believes to be the most significant are summarized below.
Critical estimates and judgments
In the process of applying our accounting policies, management has made the following estimates, assumptions and judgments, which have significant effect on the amounts recognised in the financial statement:
Provisions and contingencies
Management judgment is required for estimating the possible outflow of resources, if any, in respect of contingencies/claim/litigations against us as it is not possible to predict the outcome of pending matters with accuracy.
Warranty
The estimated liability for product warranties is recorded when products are sold. These estimates are established using historical information on the nature, frequency and average cost of warranty claims and management estimates regarding possible future incidence based on corrective actions or product failures.
Revenue from operations
The estimated refund liability and a right to recover the returned goods are recognised for the products expected to be returned at the time of sale. These estimates are established using historical information in nature, frequency and actual return of product with management estimate of future return of products.
Revenue recognition
We recognize revenue when the amount of revenue can be reliably measured; when it is probable that future economic benefits will flow to the entity; and specific criteria have been met for each of our activities as described below:
Sales of products
Revenue from sale of finished goods, stock-in-trade, raw material, service components and spares is recognised when control of the goods is transferred to the customers (retailers, distributors, large format stores etc.) being when the products are delivered to the customer. Delivery does not occur until the products have been shipped to the specified location, the risk of loss (i.e. control) have been transferred to the customer.
Revenue is recognised based on the consideration specified in a contract with a customer (transaction price) and is net of discounts and goods and services tax ("GST").
The products are often sold with discounts and customers have a right to return faulty products. Accumulated experience is used to estimate and provide for the discounts and returns. The discounts are assessed based on expected cost. We recognize contract liabilities for sales return (hereinafter referred to as "refund liability") based on reasonable expectation reflecting sale return rate incurred historically. We estimate an amount of variable consideration by using the expected value approach which we expect to better predict the amount of consideration. We recognize revenue with transaction price including variable consideration to the extent that it is highly probable that a significant reversal in the accumulated amount of revenue will not occur when the refund period has lapsed.
The transaction price will be allocated to each performance obligation based on relative standalone selling price of the goods or services being provided to a customer. We determine the stand alone price for each performance obligation by using ‘adjusted market assessment approach. In limited circumstances, we use an expected cost plus a margin approach to estimate standalone selling price.
Refund liability for the expected returns from customers is recognised as an adjustment to revenue. We have a right to recover the products from the customer when the customer exercises his right of return and recognizes an asset and a corresponding adjustment to cost of sales. A right to recover the products is measured at the former carrying amount of the product.
Our obligation to repair or replace faulty products under the standard warranty terms is recognised as provision and disclosed in Note No 13. See "Restated Financial Information - Note 13: Provisions" on page 300.
Revenue from sale of scrap arising during the manufacturing is recognised when control is transferred being when the scrap materials are collected by the scrap dealer.
Sales, installation and commissioning contracts
The fixed price contract of sales, installation and commissioning are integrated contracts and revenue is recognised at a point in time when the performance obligation is met basis the output oriented method (i.e., milestone completion) and where no significant uncertainty exists regarding the amount of consideration that will be derived on completion of the contract. Milestone is determined on the basis of survey of work performed up to the reporting date.
Provision for anticipated loss is recognised where it is probable that the estimated contract costs are likely to exceed the total contract revenue. Provision is made for liquidated damages and penalties in terms of the contract wherever there is a delayed delivery attributable to us.
Maintenance service contracts
Revenue from maintenance contracts are recognised on a pro-rata basis over the period of the contract.
Financing Components
We do not have any contracts where the period between the transfer of promised goods or services to the customer and payment by the customer exceeds one year. As a consequence, we do not adjust any of the transaction prices for the time value of money.
Inventories
Inventories are valued at lower of cost and net realizable value after providing for obsolescence and other losses, wherever considered necessary.
Cost of raw materials and traded goods comprises cost of purchases. Cost of work-in-progress and finished goods comprises direct materials, direct labor and an appropriate proportion of variable and fixed overhead expenditure, the latter being allocated on the basis of normal operating capacity. Cost of inventories also include all other costs incurred in bringing the inventories to their present location and condition. Goods in transit are valued at lower of cost and net realizable value. Net realizable value is estimated selling price in the ordinary course of business less the estimated cost of completion and costs necessary to make the sales. The basis for determination of cost of various categories of inventory are as follows:
| Category | Basis of determination |
| Raw materials, stores and spares and packaging materials | Monthly weighted average |
| Stock-in-trade | Monthly weighted average |
| Finished goods (manufactured), work in progress | Monthly weighted average of material cost plus an appropriate share of labor and manufacturing overheads wherever applicable. |
Provision for obsolescence on surplus stores and spares held to support servicing of discontinued models and cost of certain obsolete/dormant models is accrued at lower of carrying value and estimated fair value. The recoverability of all other inventories is periodically reviewed and an impairment loss is recognised only when carrying value exceeds the fair value.
Provisions and contingencies
We create provision when there is present obligation as a result of a past events and it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. A disclosure for a contingent liability is made when there is possible obligation or a present obligation that may, but probably will not, require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
The assessments undertaken in recognizing provisions and contingencies have been made in accordance with Ind AS 37, ‘Provisions, Contingent Liabilities and Contingent Assets. The evaluation of the likelihood of the contingent events requires best judgment by management regarding the probability of exposure to potential loss. Should circumstances change following unforeseeable developments, this likelihood could alter.
Provisions are reviewed at each Balance Sheet date and adjusted to reflect the current best estimate. If it is no longer probable that the outflow of resources would be required to settle the obligation, the provision is reversed.
Contingent assets are not recognised in the Restated Financial Information. However, contingent assets are assessed continually and if it is virtually certain that an economic benefit will arise, the asset and the related income are recognised in the period in which the change occurs.
Property, plant and equipment
Property, plant and equipment are stated at original cost net of tax/ duty credit availed less government grants received to purchase/construct assets, accumulated depreciation and impairment losses, if any. When the significant part of property, plant and equipment are required to be replaced at intervals, we derecognize the written down value of replaced parts and recognizes the new part with its own associated useful life and it is depreciated accordingly. Likewise, when a major repair and inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as replacements, only if recognition criteria are satisfied. All the other repair and maintenance costs are recognised in the Restated Statement of Profit and Loss as incurred.
Freehold land is carried at historical cost.
Depreciation on property, plant and equipment is provided on the straight-line method over the estimated useful life of the assets at rates which are higher / lower than the rates specified in Schedule II to the Companies Act, 2013. The life of the assets has been assessed as under based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance support etc. The estimated useful lives are as follows:
| Category of property, plant and equipment | Useful life as per Schedule II (Years) | Estimated Useful Life (Years) |
| Buildings | 30 | 10-20 |
| Plant and machineries | 15 | 5-10 |
| Category of property, plant and equipment | Useful life as per Schedule II (Years) | Estimated Useful Life (Years) |
| Furniture and fixtures | 10 | 5 |
| Office equipments | 5 | 5 |
| Computers | 3 | 5 |
| Vehicles | 8 | 5 |
Useful lives, depreciation method and residual value are reviewed by the management at the end of each reporting period.
Gain and losses on disposals are determined by comparing proceeds with carrying amount of property, plant and equipment. These are included in the Restated Statement of Profit and Loss.
An assets carrying amount is written down immediately to its recoverable amount if the assets carrying amount is greater than its estimated recoverable amount.
Impairment
At the end of each reporting period, we review the carrying amounts of its property, plant and equipment and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). When it is not possible to estimate the recoverable amount of an individual asset, we estimate the recoverable amount of the cash-generating unit to which the asset belongs.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the Restated Statement of Profit and Loss.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in Restated Statement of Profit and Loss.
Non-Financial assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the assets carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an assets fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
Warranty
The estimated liability for assurance type warranty is recorded when products are sold based on managements best estimate. The expense for such warranties is included under customer service expenses (Other expenses). These estimates are established using historical information on the nature, frequency and average cost of warranty claims and management estimates regarding possible future incidence based on corrective actions or product failures. The timing of outflows will vary as and when warranty claim will arise.
Recent Accounting Pronouncements
The Ministry of Corporate Affairs has amended the Companies (Indian Accounting Standard) Rules, 2015 via notifications dated August 12, 2024, and September 9, 2024, to introduce the new Ind AS 117, "Insurance Contracts" and amended the Ind AS 116 i.e. Leases, respectively. Both are effective from April 1, 2024.
This new standard and the aforesaid amendment did not have any material impact on the amounts recognized and are not expected to significantly affect the current or future periods.
Significant Developments after June 30, 2025 that may affect our future results of operations
Except as stated in this Red Herring Prospectus, to our knowledge, no circumstances have arisen since the date of the Restated Financial Information as disclosed in this Red Herring Prospectus which materially and adversely affect or are likely to affect our operations or profitability, or the value of our assets or our ability to pay our material liabilities within the next twelve months.
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