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LG Electronics announces price hike

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DQC Bureau
New Update

New Delhi



June 3, 2008

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LG Electronics India Pvt Ltd (LGEIL) announced a price hike owing to the

constant escalation of input costs. The price hike will span across categories

like monitors and optical storage devices and the targeted price increase is

around seven to 10 percent. However, with a view to soft pedal these sudden

impacts LG will be increasing the prices in a phased manner, starting with three

percent with immediate effect.

The LCD monitors will have two additional impacts in market prices. As the

customs duty is based on MRP, this dollar appreciation is further compounded by

proportionate increase in duty owing to increased MRP. Additionally, there is an

increasing trend of LCD panel prices. Thus, in LCD monitors the impact will be a

combined effect of dollar appreciation, proportionate duty increase and the

panel price increase.

Commenting on the price hike, R Manikandan, Business Group Head-Monitors

and OSD, said, “It has become imperative for us to consider price hike due to

rise in exchange rate, which has gone up significantly in the last one month.

From sub-40 range in the last week of April, the exchange rate has gone up to

42.5 as on May 29. This is approx seven percent rise in exchange rate over last

one month period, resulting in increased costing, calling for increase in market

prices.”

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Talking to the channel partners on the price hike, he further said, “Our

partners have always been very supportive in the past and we would appreciate

their support in this complex situation as well. I take this opportunity to

request them to take due care while quoting forward prices as the price increase

will be felt steadily on all products and brands, of course with varied

intensity levels. It can be a good idea to stock up the LCD monitors as much as

they can manage in the short run.”

As the dollar projections are looking stronger in the short run, the overall

prices will have to go upwards steadily, the most vulnerable being the LCD owing

to compounded effect.

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