Best monopoly stocks in India for investment in 2023 | Motilal Oswal

Best Monopoly Stocks in India For Investment In 2023




Introduction:

Monopoly companies operate in a market with little or no competition. In other words, these companies enjoy the lion’s share in their respective markets. The stocks belonging to monopoly companies are known as monopoly stocks.

Investing in monopoly stocks is a lucrative option for you as these companies are unlikely to lose their revenues to their competitors. They enjoy stable market share, strong pricing, and consistent profitability. 

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Best Monopoly Stocks in India in 2023:

1. IRCTC

The full form of IRCTC is the Indian Railways Catering and Tourism Corporation. This company provides internet ticketing, catering, and tourism services to passengers travelling via Indian railways. IRCTC enjoys a 100% market share in the railways ticketing business. It has also added flight bookings, hotel bookings, bus services, and holiday packages to its service portfolio. 

Although ‘Indian Railways’ was established in 1845 by the Britishers, IRCTC was founded only in 1999 and is owned by the Government of India. As of 10 July 2023, the company's market capitalisation stood at Rs. 49,272 crores. Its shares were trading for Rs. 619.70 per share at the National Stock Exchange (NSE) and Rs. 617.00 per share at the Bombay Stock Exchange (BSE).

2. Hindustan Aeronautics Limited

Hindustan Aeronautics Limited (HAL) is another government-owned business in India's list of top monopoly stocks. This company is a critical player in India’s aerospace and defence sector. It offers to design, develop, repair, service, and manufacture a range of aircraft and related products, including helicopters, aero-engines, jets, avionics, etc.

HAL was founded in 1940 to manufacture combat aeroplanes in India. As of 10 July 2023, the market capitalisation of this company stood at Rs. 1,26,280 crores. HAL shares were trading for Rs. 3,912.00 per share at the NSE and Rs. 3,912.85 at the BSE. In the last three years, they have provided investors with a return of 313.67%.

3. Coal India Limited

Coal India Limited is again a state-owned business. This company is engaged in the business of selling coal and coal-based products for industrial purposes. Its product portfolio includes coking coal, semi-coking coal, non-coking coal, washed coal, and coal fines.

Coal India is among the largest coal-producing companies in the world and contributes approximately 82% of India’s total coal production output. 

As of 10 July 2023, Coal India has a market capitalisation of Rs. 1,44,054 crores, and its shares were trading for Rs. 234.90 and Rs. 235.00 per share at the NSE and the BSE, respectively. 

4. ITC Limited

ITC Limited is one of the leading companies engaged in the Fast-Moving Consumer Goods (FMCG) business. It also operates in hospitality, paper and packaging, and agriculture segments. It boasts a solid 77% share of India’s cigarette market. Some well-known brands of ITC include Classic, Gold Flake, Wills, Navy Cut, Aashirvad, Fiama, Vivel, Classmate, Managldeep, and Aim.

On 10 July 2023, ITC shares were trading for Rs. 472.35 per share at the NSE and Rs. 473.15 per share at the BSE. The market capitalisation of the company stood at Rs. 5,80,041 crores. In the last three years, ITC shares have provided a return of 141.17%.

5. Nestle India

Nestle India is an Indian subsidiary of this Swiss multinational company. It was founded in 1959 and specialises in food, beverage, chocolate, and confectionery products. Some of the highly popular brand names under Nestle include Maggi. Nescafe, KitKat, and Milkmaid. But the segment in which it enjoys a monopoly is infant food or Cerelac, occupying up to 96% of the market share.

The shares of Nestle India are listed on both the NSE and the BSE, with their trading prices hovering at Rs. 22,852.30 per share and Rs. 22,930.00 per share, respectively (as of 10 July 2023). The market capitalisation of the company stood at Rs. 2,17,709 crores.

The Bottom Line

Investing in the best monopoly stocks in India can be a smart move. Some benefits of monopoly companies are that they have relatively fewer competitors, provide stability to your portfolio, and can generate profits consistently.

However, you must do your research and take a calculated approach. Consider a company’s fundamentals and other crucial factors before investing your hard-earned money in its shares.

If you haven’t yet started investing in the stock markets, you can open a free Demat account with Motilal Oswal.

 

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