LG Electronics Shares Rise 1.5% After CBDT Advance Pricing Agreement Cuts Tax, Royalty Uncertainty

Shares of LG Electronics India Ltd surged 1.5% to touch a day’s high of Rs 1,495.40 on 6th January. This came after the company said on Monday (5th January, 2026) that it has signed and concluded an Advance Pricing Agreement (APA) with the Central Board of Direct Taxes (CBDT).

LG Electronics India said it had filed the Advance Pricing Agreement application with Indian tax authorities on 29th March, 2018. The agreement covers nine years from 1st April 2014, to 31st March, 2023, and was concluded on 5th January, 2026.

After signing the APA, the company said its contingent liabilities of Rs 172.44 crore related to direct taxes will be reduced to nil. A separate contingent liability of Rs 315.30 crore linked to royalty payments to promoter LG Electronics Inc., Korea, will also be eliminated.

The APA will result in a net tax expense of Rs 17.71 crore, excluding applicable interest. This is calculated on the payment date. In addition, LG Electronics India will pay a net amount of Rs 3.86 crore to LG Electronics Inc. under secondary adjustment provisions. This aligns with India’s transfer pricing rules.

For the quarter ended September 2025, LG Electronics India reported a 27.3% year-over-year fall in net profit to Rs 389 crore. This is compared with Rs 536 crore in the same period last year. Revenue from operations rose 1% year-over-year to Rs 6,174 crore from Rs 6,113.8 crore. This indicates steady consumer demand.

EBITDA declined 27.7% year-over-year to Rs 547.5 crore from Rs 757.4 crore. Meanwhile, the EBITDA margin narrowed to 8.9% from 12.4% a year ago.

At 11:39 AM, shares of LG Electronics India were trading 1.40% higher at Rs 1,490.10 on NSE.

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