Government Stocks in India to Invest In

Government stocks can break the “High-risk, High-reward” play in the stock market. It helps investors generate wealth and high returns with low risk tolerance. These stocks have become popular as backed by government support and steady growth potential. However, it is essential to conduct research on top-notch government companies and their financial health to invest in the right place. 

To do so, you can explore the government stocks list in this passage and overview of the companies operating in this promising sector. Before delving deeper into the topic, explore some facts about the government sector to boost your understanding. 

Government Sector in India: An Overview

The government sector plays an important role in the growth of GDP (Gross Domestic Product). The companies involved in this sector are major players in employment generation and societal welfare. Investing in the best government stocks in India offers individual resilience and steady growth potential. Moreover, one can earn higher dividend income through such stocks to manage daily expenses. 

The main aim of the Indian government sector is to meet the public interest. Government companies are contributing the best of their efforts to achieve this aim. Besides the highly resilient nature of the Indian government stocks, it is essential to conduct research and assess the factors that might impact an individual’s investment journey. Be on this piece of research to do so and select the best investment option for the coming years. 

Government Stocks List in India

*Data is updated as of 10th December 2024

Overview of Government Stocks in India

1. State Bank of India Ltd. 

Founded: 1955

Headquarters: Mumbai, Maharashtra 

Market Capitalisation: ₹7,67,000 crores

State Bank of India Ltd. has a rich legacy of over 200 years and owns approximately 2,400 branches across the country. Recently, in 2024, SBI ranked 55th in Forbes Global 2000 and became the most trusted bank in India, with a customer base of more than 50 crore people. Over the past few decades, investors have considered it one of the best government stocks in India to generate higher returns in the long run. SBI offers different services like merchant banking, mutual funds, life insurance, and credit cards. 

2. LIC Ltd. 

Founded: 1956 

Headquarters: Mumbai, Maharashtra 

Market Capitalisation: ₹6,05,000 crores

LIC Ltd., or Life Insurance Corporation Ltd., operates as the largest insurance company and institutional investor. This company offers a wide range of products like term insurance, endowment policy, health insurance, risk management, mutual funds, ETFs, term life insurance, retirement plans, and asset management. Substantial growth in this one of the best government stocks in India encourages most investors to invest. The company accumulate premiums from its customers and invests them across different sectors, including banks, FMCG, mining, chemicals, fertilisers, infrastructure, information technology, logistics, etc. 

3. NTPC Ltd. 

Founded: 1975

Headquarters: New Delhi

Market Capitalisation: ₹3,59,000 crores

NTPC Ltd., also known as National Thermal Power Corporation, operates to meet the country’s energy requirements. This government company aims to achieve 130 GW of capacity by the end of 2032. NTPC standouts in the energy sector and successfully installed 16% of the total electricity generation capacity in India. The vast network of power stations across the nation helps this organisation meet its energy needs. As per the analysts, NTPC, one of the best Indian government stocks gained a buy rating of 87% for the coming years. 

4. Coal India Ltd. 

Founded: 1975 

Headquarters: Kolkata, West Bengal 

Market Capitalisation: ₹2,56,000 crores

Coal India Ltd. is a mining company engaged in coal production. The company produces around 83% of the total coal in India to meet the energy requirements. Coal India Ltd. mainly focuses on customer satisfaction with quality management and an effective distribution network. Moreover, investors consider it as one of the best government stocks in India because of its WEB based online monitoring system. This system helps the company monitor the implementation of the coal projects. 

5. Indian Oil Corporation Ltd. 

Founded: 1959 

Headquarters: New Delhi 

Market Capitalisation: ₹2,04,000 crores

Indian Oil Corporation Ltd. is a government-owned enterprise engaged in petroleum and petrochemical products. The company is operating with a robust infrastructure and 34,000+ fuel stations across the country. Moreover, this company has focused on increasing its global presence in foreign nations like Singapore, Myanmar, Sri Lanka, Bangladesh, and more. The vast network of storage facilities, depots, LPG bottling plants, and fuel stations played a vital role in the success of this organisation in the oil and gas sector.  

7. GAIL (India) Ltd. 

Founded: 1984

Headquarters: New Delhi

Market Capitalisation: ₹1,38,000 crores

GAIL (India) Ltd. operates with a huge pipeline network that encompasses the use of natural gas in the country. Moreover, this government company is also engaged in the exploration of renewable energy sources such as wind power and solar power. Government-owned 51.8% stake in this organisation and operates it under the administration of the Ministry of Petroleum and Natural Gas. This one of the best government stocks in India has declared a dividend yield of 2.65% in 2024. Investors can consider it a trustworthy stock as it is dedicated to contributing to the growth of the energy sector in India, which is the focus nowadays.    

7. Punjab National Bank Ltd. 

Founded: 1984

Headquarters: Dwarka, Delhi 

Market Capitalisation: ₹1,25,000 crores

Punjab National Bank Ltd. operates with 13,000+ ATMs to serve its customers efficiently. It is a government-owned enterprise existing with a rich legacy of 150+ years in the business environment. PNB has become one of the best government stocks in India after launching its 24/7 WhatsApp banking services in the year 2022. As of now, it has more than 18 crore customers engaged in services like internet banking, mobile banking, merchant banking, mutual funds, and more. The company aims to be financially healthy and offer investors high growth potential for the coming years. 

Government Stocks List in India With PE Ratio

*Data is updated as of 10th December 2024

How to Invest?

Follow the steps mentioned below to invest in the Indian government stocks and make a diversified investment portfolio. 

• Step 1: Research the best stocks with steady growth potential or consult your financial advisor to pick the best among them. 
• Step 2: Open your demat account to place a buy order for the shares selected. 
• Step 3:  Execute the order at the market price and potentially invest your money. 
• Step 4:  Track your returns from government stocks in the portfolio section and wait for the right time to book profit.  

To Conclude

Investors with low-risk tolerance should consider Indian government stocks as a reliable option for investing their capital. These equities prioritise capital appraisal and preservation. Investing in such stocks also provides the benefit of high dividend income. Moreover, these stocks are also ideal for a diversified portfolio so as to earn balanced returns. 

Note: Conduct your own research on top government stocks in India and choose the best one to generate higher returns in the minimum possible time. 

FAQs On Government Stocks in India

1. What are government stocks?

Ans. Government stocks are shares of business enterprises owned by the GOI (Government of India). These stocks are proven to be strategic options for diversifying an investment portfolio as they come with extensive government support and steady growth potential. Investors looking to build wealth in the long-term can consider these stocks. 

2. What are the best government stocks to buy?

Ans. Here are some of the high-potential government stocks in India encouraging investors to invest their invaluable money. 

*Data is updated as of 10th December 2024

3. What are the risks associated with government stocks?

Ans. Government companies are operating with high growth potential and effective cash flow positions. However, investors should identify and assess some risks for a safe investment. These risks include bureaucracy, low liquidity, and disinvestment. Evaluate the mitigating strategies to overcome these risks so as to generate consistent returns. 

4. What are the benefits of investing in government stocks?

Ans. Government stocks in your portfolio could act as the shining stars. They come with several advantages, including high dividend payouts, adequate cash flow statements, stable returns, long-term growth, government support, and diversification. Invest in these stocks to get such benefits and generate higher returns in the long run.