LG Group will beef up its research and development efforts focusing on energy, displays, home electronics and health care, the country’s fourth largest business group said Wednesday.

LG will increase its researchers and R&D budget by about 25 percent to about 3,100 and to 4.7 trillion won ($4.1 billion) this year, it said.

About 5,000 of 9,000 new recruits would be allocated to R&D sections.

“We will make substantial investment into R&D to secure new growth engines and technologies needed for our operation in a five to 10 year time frame,” group chairman Koo Bon-moo told a meeting of over 200 executives for a performance review.

“We will encourage our teams to think outside the box and will stay open to adoption of technologies not originating in the firm’s own research houses,” Koo said. 

LG Group has LG Electronics, LG Display and LG Telecom operating in over 80 countries.

Of this year’s budget, 1 trillion won is earmarked for new business areas including solar batteries, hybrid car batteries, organic light emitting diodes, water treatment and health care.

After new hires are completed this year, about 31,000 employees making up 30 percent of the group will belong to the R&D sector.

LG’s renewed emphasis on R&D is in line with its 11 percent revenue increase eyed for this year.

It vowed to strengthen its electronics, chemical and mobile businesses with a total of 21 trillion won investment this year, the largest amount ever.

The amount is 11.7 percent more than allocated for 2010 and will be funneled into the group’s core sectors including smart TVs, electric vehicle batteries and LED.

LG Electronics, the world’s troubled No. 3 mobile phone maker vowed to quadruple its smartphone sales to 30 million this year after remaining in the red for three straight quarters last year.

Its latest bet was the introduction of LG Optimus 3D, the world’s first smartphone with a 3-D platform under a dual-core processor.

By Cynthia J. Kim (cynthiak@heraldcorp.com)