Why Korean Giants Are Looking to India: Inside the LG and Hyundai Listings

10/23/20264 min read

When Hyundai Motor India and LG Electronics India listed on Mumbai’s stock exchanges, the headlines were about size. The more interesting question is why two of Korea’s best-known companies chose to bring their Indian businesses to market in India. The answer says a lot about how capital is priced, and about why India is becoming a financial destination as well as a manufacturing one.

What actually happened

These were listings of Indian subsidiaries. The Korean parents, Hyundai Motor Company and LG Electronics Inc., remain listed in Seoul. Both IPOs were also “offers for sale,” meaning the parent sold existing shares and no new shares were issued.

LG Electronics India listed in October 2025. It surged about 50% on debut, reaching a valuation of roughly $13 billion, above its South Korean parent’s market capitalisation of about $9 billion. The IPO drew bids worth around $50 billion, making it India’s most-bid IPO since 2008.

The $9 billion figure is what the entire parent company was worth in Seoul, not a hypothetical Korean valuation of the India unit. The Indian arm, one part of the business, was briefly valued higher than the whole group at home.

Hyundai Motor India listed a year earlier, in October 2024. The $3.3 billion IPO was India’s largest ever and valued the company at about $19 billion. That was roughly 40% of its parent’s market capitalisation. Its debut was weaker than LG’s: shares fell about 7% on day one, amid concerns over valuation and a slowdown in car sales. Indian markets are not a guaranteed premium, and pricing matters.

What is the “Korean discount”?

The Korean discount is the tendency for Korean companies to trade at lower valuations than comparable firms elsewhere. Investors usually point to three causes.

1. Geopolitical risk - Tension with North Korea adds a layer of uncertainty that some investors price in, even when day-to-day business is unaffected.

2. Corporate governance and the chaebol structure - Large family-influenced groups such as Samsung, Hyundai, SK and LG powered Korea’s industrial rise. But investors have long raised concerns about complex cross-shareholdings, minority shareholder rights and concentration of power. One widely cited estimate puts the top ten chaebols’ combined size at nearly 60% of GDP in 2021. That figure compares company revenues with GDP, so it indicates influence rather than a literal share of national output.

3. Capital allocation - Korean companies have historically returned less cash to shareholders than peers. One market analyst recently put the dividend payout ratio at around 29% and argued it would need to reach 50–60% to end the discount.

The twist: Korea is changing, and fast

South Korea launched its Corporate Value-Up Program in February 2024. Later steps included a July 2025 Commercial Act amendment giving directors a fiduciary duty to all shareholders, and dividend tax cuts in December 2025. The market responded. The KOSPI tripled between the end of 2024 and May 2026, helped by reform, AI-driven chip demand and momentum in defence, shipbuilding and nuclear power. The index’s price-to-book ratio, which stayed below 1 from 2022 to 2025, had climbed to around 1.87 by April 2026.

But the picture is mixed:

  • Korea’s estimated 2026 price-to-book ratio of about 1.9x is still below that of the US, Taiwan, India and Europe.

  • By mid-September 2026 the KOSPI was about 26% below its June record, and investors note Value-Up participation remains largely voluntary.

  • Strong results at Samsung and SK Hynix do not prove the reforms are working across the wider market.

The fair summary: the discount is shrinking, not gone, and the real test is whether policy turns into lasting corporate behaviour.

So why does India still attract Korean giants?

If the discount is easing, why list in India at all? Because the reasons go beyond fixing a valuation gap.

  • A growth story investors will pay for - India’s home appliance and consumer electronics market is projected to grow around 11% a year from 2024 to 2029. Investors in Mumbai are valuing growth that Seoul’s mature home market can’t offer.

  • Deep domestic capital - Strong participation from Indian institutions and retail investors means large, well-known brands can raise substantial capital locally.

  • Brand trust - Hyundai and LG have operated in India for decades and are embedded in everyday life. Local investors reward businesses they already know.

  • Funding local expansion - Proceeds and visibility help fund capacity, R&D and market-share growth in India itself.

  • Strategic fit - Listing locally can deepen a company’s Indian identity, which matters for policy, partnerships and talent.

Put simply, Korean groups are choosing where each part of the business is best understood and valued.

What this means for Korean businesses

Large groups: India can be a source of capital as well as customers. Listing a subsidiary is one option, alongside joint ventures and strategic partnerships.

Mid-sized manufacturers: you will not be doing a billion-dollar IPO, but the underlying logic still applies. India offers growing demand, willing partners and, increasingly, investors who value local presence.

Everyone: India rewards preparation. Entity structure, regulation, partner selection and capital strategy all affect each other, and early choices are hard to reverse.

Where an India-Korea consultancy helps

Cross-border decisions are easier with someone who understands both sides. A good advisor can:

  • Design entry and expansion structures that fit your long-term goals

  • Introduce you to vetted Indian partners, investors and advisors

  • Guide you through regulatory, tax and compliance requirements

  • Bridge cultural and communication gaps between Korean headquarters and Indian teams

Final thoughts

Capital tends to flow where value is recognised. LG and Hyundai’s Indian listings showed that clearly, even if the story is more nuanced than “India beat Korea.” Korea is working hard to close its discount, and India remains one of the world’s most compelling growth markets. For Korean companies, that is less an either/or than a reason to build a presence in both.

Planning your India strategy, whether operations, partnerships or investment? Talk to our team about how we can help.

References:

  1. Reuters via DealStreetAsia, “LG Electronics India surges 50% in trading debut” (Oct 2025). https://media.dealstreetasia.com/stories/lg-electronics-india-listing-459823

  2. Business Standard, “LG Electronics India leaps 48% on debut, exceeds Korean parent in mcap” (Oct 2025). https://www.business-standard.com/amp/markets/news/lg-electronics-gains-48-on-debut-best-listing-performance-by-a-large-ipo-125101401331_1.html

  3. Reuters via DealStreetAsia, “LG Electronics’ Indian unit seeks valuation of up to $8.7b in IPO” (Oct 2025). https://media.dealstreetasia.com/stories/lg-electronics-indian-unit-seeks-valuation-of-up-to-8-7b-in-ipo-458149

  4. WION News, “Hyundai India launches USD 3.3 billion IPO” (Oct 2024). https://www.wionews.com/autonews/hyundai-india-launches-usd-33-billion-ipo-767319

  5. Reuters via Investing.com, “Hyundai India’s shares fall on debut after record $3.3 billion IPO” (Oct 2024). https://investing.com/news/economy-news/hyundai-indias-shares-fall-2-in-debut-trade-after-record-33-billion-ipo-3674268

  6. BCG, “South Korea: Capital Efficiency and Value Creation” (2026). https://www.bcg.com/publications/2026/south-korea-capital-efficiency-and-value-creation

  7. Reuters via Khaleej Times, “Samsung, SK Hynix payouts test South Korea’s reform drive” (Sept 2026). https://www.khaleejtimes.com/samsung-sk-hynix-payouts-test-south-koreas-reform-drive-as-investors-seek-more

  8. Fn News, “KOSPI Nears P/B Ratio of 2” (2026). https://en.fnnews.com/news/202602221805177009

  9. Fn News, “KOSPI 8000 Is Not a Bubble…” (June 2026), for the dividend payout figure. https://en.fnnews.com/news/202606052202251944

  10. BIT Knowledge Hub, “The KOSPI 2026 Supercycle”, for the Value-Up timeline. https://www.bit.com/knowledge-hub/the-kospi-supercycle

  11. Daxue Consulting, “Korean chaebols explained”, for the chaebol and GDP figure. https://daxueconsulting.com/south-korean-chaebols/