Government Stocks List to Buy in 2025
Posted by : sachet | Tue Jan 21 2025
Government stocks have become a wise investment option for most investors looking to generate higher returns in the long term. These equities generally come with affordability and low risks to encourage investors. Moreover, the government sector aims to meet the public interest. It acts as the key driver contributing to the economic development of the country.
What are Government Stocks?
Government stocks in India represent the equities of government-owned companies set to serve the public interest. Government-owned companies are the organisations in which the government holds at least 51% of the stake. These companies not only consider market demands but also foster economic growth. Investing in such stocks has been considered a potential way to generate higher returns in the long run with a minimum risk tolerance.
Indian government stocks, backed by government support, have become popular among investors due to their high dividend payout policies. One can invest in the PSUs (public sector undertakings) operating across different industries like infrastructure, finance, energy, FMCG, etc. To have a safe and diversified portfolio of investment, you should explore the government stocks list provided below with their LTP (Last Traded Price), market capitalisation, and 52-week High/Low.
Government Stocks List By Market Capitalisation
| Stock Name | LTP (in ₹) | Market Capitalisation (in cr.) | 52-Week High (in ₹) | 52-Week Low (in ₹) |
| State Bank of India Ltd. | 861.20 | 7,67,000 | 912.00 | 600.65 |
| LIC Ltd. | 956.95 | 6,05,000 | 1,222.00 | 746.30 |
| NTPC Ltd. | 370.00 | 3,59,000 | 448.45 | 280.85 |
| ONGC Ltd. | 256.85 | 3,23,000 | 345.00 | 92.05 |
| Hindustan Aeronautics Ltd. | 4,628.45 | 3,10,000 | 5674.75 | 2585.00 |
| Coal India Ltd. | 415.25 | 2,56,000 | 543.55 | 342.30 |
| Indian Oil Corporation Ltd. | 144.40 | 2,04,000 | 196.80 | 116.60 |
| Punjab National Bank Ltd. | 109.05 | 1,25,000 | 142.90 | 84.75 |
| GAIL (India) Ltd. | 209.60 | 1,38,000 | 246.30 | 134.85 |
| Bharat Dynamics Ltd. | 1,199.80 | 43,970 | 1,794.70 | 657.00 |
*Data is updated as of 10th December 2024
Factors Affecting Government Stocks in India
It is good to invest in government stocks. They are resilient to economic downturns, but one should consider some factors that might have an impact on the returns generated. These factors include.
- Financial Health: Monitor and assess the company’s financials using different parameters, such as net profit, sales, revenue, EPS (Earnings Per Share), PE (Price-to-Equity) ratio, and more. This will help you get an idea about the company’s future performance. Invest in government stocks with an effective cash flow position in the market to deal with future uncertainties.
- Historical Records: Check the historical performance of government companies and compare them to identify the best stocks. You can consider comparing their percentage growth in net profit, liquidity in trading, and governments’ stake in the company. Select the top rankers to invest in and earn the highest possible returns.
- Sector Outlook: The best government stocks in India are spread across all sectors. Assess the potential of each sector to evaluate the future performance of the companies involved in it. Consider different parameters to analyse the potential of stocks, such as technological innovations, regulatory frameworks, emerging trends, and demand-supply management.
- Competitiveness: While choosing from the top government stocks in India, identify the companies aggressively competing and sustaining a competitive edge in the market. The high competitiveness of a firm might help you get consistent returns and also provide you with additional resilience to economic downturns.
Top Government Stocks Based on 1-Year Returns
| Stock Name | 1-Year Returns (%) |
| Bharat Dynamics Ltd. | 76.60 |
| Hindustan Aeronautics Ltd. | 65.84 |
| GAIL (India) Ltd. | 48.60 |
| State Bank of India Ltd. | 40.24 |
*Data is updated as of 10th December 2024
Dividend Yield in Government Stocks in 2024
| Stock Name | Dividend Yield (%) |
| Indian Oil Corporation Ltd. | 8.31 |
| Coal India Ltd. | 6.26 |
| ONGC Ltd. | 4.87 |
| GAIL (India) Ltd. | 2.62 |
| NTPC Ltd. | 1.86 |
| State Bank of India Ltd. | 1.59 |
| Punjab National Bank Ltd. | 1.38 |
*Data is updated as of 10th December 2024
Benefits of Investing in Best Government Stocks
Top government stocks in India not only appreciate capital but also provide investors with multiple benefits. These include.
- Diversification: Indian government stocks are suitable for those with a low risk tolerance. By adding such stocks to one’s portfolio, one can earn balanced returns. As backed by government and steady growth prospects, these stocks can prove to be the shining star for diversified investment portfolios. Investors can invest across different sectors with the help of shares of the government-owned companies.
- Taxation: Interest earned on government stocks provides tax benefits to investors. As a result, such stocks have become a golden opportunity for investors paying high taxes on their income. Government companies are also getting various tax benefits that could benefit investors in terms of returns and dividend income.
- Preserved Capital: The best government stocks in India come with a resilient nature and can preserve the capital of investors. This benefit makes these stocks an ideal choice for investors looking to safeguard their capital during economic downturns and volatile markets.
- Government Support: The direct and indirect involvement of the government could help businesses grow in the coming years. Therefore, government companies operating in the market can take the benefits of several schemes, initiatives, and budgets that the government announce throughout the year. Investing in the top government stocks in India is beneficial as they are backed by extensive support of government and have high growth potential.
- Effective Cash Flow: Government companies operating in the business world have effective cash flow positions because of the availability of funds at low interest rates. Thus, investing in such stocks might provide investors with stable returns and high dividend income. Pick the stocks with high market capitalisation to generate higher returns in the market.
Risks Associated With Government Stocks
Indian stock market is subject to risks. And identification and assessment of these risks are pivotal to safeguarding the investment portfolio. To do so, explore the risks and their impacts tabulated below.
| Risks | Impact |
| Interest Rate | Fluctuations in interest rates might impact the market value of bonds which might lead to capital losses for the investors. This will impact the overall returns generated from the Indian government stocks. Stay informed about the change in interest rates and their impact to eliminate this risk from your investment journey. |
| Low Liquidity | Top government stocks in India can suffer from low liquidity. Certain problems or volatile markets might cause such stocks to be less liquid, which may cause investors to lose money. React immediately to such conditions to avoid losses in the Indian stock market. |
| Inflation | Rising inflation might impact the revenues and profit margins of government enterprises operating in the market. However, it might impact the stock performance. Investors should consider inflation as a key risk that could impact their investment journey with the best government stocks in India. |
Let’s Wrap
Government stocks in the portfolio might relax investors during economic slowdowns and market volatility. These stocks are projected to show a notable growth in the 2025. Also, the government is declaring several initiatives to foster growth across all sectors. And government companies are major beneficiaries of such schemes and initiatives. We are heading to February 2025, the time when the government will announce the budget. And analysts are expecting significant upside movements in the best government stocks in India because of government plans to promote GPD growth.
FAQs On Government Stocks List to Buy
1. Which government companies are listed on the NSE?
Ans. Here are the best government stocks in India that are listed and publicly traded.
- State Bank of India Ltd. (NSE: SBIN)
- LIC Ltd. (NSE: LICI)
- Coal India Ltd. (NSE: COALINDIA)
- Hindustan Aeronautics Ltd. (NSE: HAL)
- Bharat Dynamics Ltd. (NSE: BDL)
- NTPC Ltd. (NSE: NTPC)
- Punjab National Bank Ltd. (NSE: PNB)
- Indian Oil Corporation Ltd. (NSE: IOC)
- ONGC Ltd. (NSE: ONGC)
- GAIL (India) Ltd. (NSE: GAIL)
2. How to invest in the best government stocks?
Ans. To invest in the best government stocks, conduct research and select the fundamentally strong shares with positive indicators. You can also consider stock advisory platforms available in India. Select the stock and place a buy order through your demat account. Now, track your returns in the portfolio section and book profit promptly.
3. Is investing in government stocks good?
Ans. Top government stocks in India come with extensive support and cash flow positions in the competitive business environment. Investing in such stocks might offer you double or triple-digit returns in the long term. It is essential to research the best stocks so as to create a diversified investment portfolio, which will prove to be the best strategy for balanced returns.
4. Which government stocks will boom in 2025?
Ans. Indian government stocks are trading at their bottom and are projected to show a rally in the coming years. Here are some of the government stocks that could provide higher returns in 2025.
| Stock Name | Market Capitalisation (in cr.) | Analyst Ratings (in %) |
|---|---|---|
| NTPC Ltd. | 3,59,000 | 87 |
| ONGC Ltd. | 3,23,000 | 78 |
| Coal India Ltd. | 2,56,000 | 94 |
| Indian Oil Corporation Ltd. | 2,04,000 | 82 |
| GAIL (India) Ltd. | 1,38,000 | 76 |
| Punjab National Bank Ltd. | 1,25,000 | 85 |
*Data is updated as of 10th December 2024.
