Vibhor Steel Tubes IPOExplore

Best Monopoly Share In India

03 January 20246 mins read by Angel One
Monopoly companies face little to no competition, which makes them a favourite of investors. Check out our list of top monopoly stocks for long-term investment.
Featured Image
ShareShare on 1Share on 2Share on 3Share on 4Share on 5

 

In the domestic equity market, where big companies rule and new ones pop up all the time, finding hidden gems can be exciting. Today, let’s explore three lesser-known but powerful companies – Pricol, Praj Industries, and Jindal Stainless – that could be great investments.  

Pricol dominates the auto instrumentation sector with strong relationships with major manufacturers and a growing range of products. Praj Industries excels in biofuels and renewable energy, benefiting from India’s focus on green initiatives and advanced technologies. Lastly, Jindal Stainless leads the Indian stainless-steel market, using its integrated operations and strong distribution network.  

Digging into their stories, we’ll find out why these companies could be worth watching, possibly offering opportunities for significant wealth growth. 

Pricol Ltd  

This is the world’s 2nd largest producer of instrument clusters. These are the same clusters and instruments you see in your car, or bike which show you the speed. This is a very fast-growing market because everyone is buying cars and there is huge demand. 

The company has capex plans of Rs 400-450 crore over the next 3-4 years (FY26-FY27) to enhance capacity, mainly for new products, which are part of the PLI scheme. 

The company has two R&D centres, which are approved by DSIR. As of March 2023, co. has made 13 inventions for which 18 patents have been filed, out of which 14 are granted and the remaining are under review. In FY23, 4.5% of the total revenues were spent on R&D. 

The company has a market capitalization of Rs 4,571 Crores with a current stock price of Rs 375. In the last three years, it has shown a sales growth of 16.5%, and the current sales growth is 18.5%. The stock has a Price/Earnings ratio of 37.6, and the price-to-book value is 5.93, which is relatively high compared to the industry PE of 32.0. The Debt-to-Equity ratio is low at 0.12, indicating a healthy financial position. The Return on Capital Employed (ROCE) is 20.1%, and the Return on Equity (ROE) is 18.3%. Promoter holding is 38.5%. Despite a dividend yield of 0.00%, the Profit after Tax is Rs 122 Crores, reflecting a sound financial performance 

Praj Industries Ltd 

It has a 70% market share in India and has 10% market share globally. It helps in ethanol manufacturing plants and other sustainability-related solutions. Now whole world is focusing on the reduction of carbon footprint, Praj has everything to do to gain from this. 

It is setting up a manufacturing facility near a major port with an investment of Rs. 100 crores and expects to start commercial production by Q4FY24. The order book for FY23 stands at Rs. 4,057 crore and 75% of the orders came for ethanol plants based on the starchy feedstock. 

The company has a market capitalization of Rs 10,090 crore with a current stock price of Rs 549. The stock has seen a high of Rs 650 and a low of Rs 299. It has a price-to-earnings ratio (P/E) of 37.2 and a book value of Rs 60.6. The dividend yield is 0.82%, and the return on capital employed (ROCE) and return on equity (ROE) stand at 31.0% and 23.7%, respectively. 

Over the past 3 years, the company has shown a sales growth of 47.4%, and the current sales growth is 16.7%. The debt-to-equity ratio is low at 0.03, indicating a strong financial position. The price-to-book value is 9.09, while the industry P/E is 39.0. Promoter holding is at 32.8%, and the profit after tax is Rs 271 crore. 

Jindal Stainless Ltd 

This company has more than 50% of the market share in the stainless-steel industry in India. It is also the biggest supplier of razor blades to Gillette India. One of the negatives is that this kind of industry is cyclical in nature, that’s why you may not see the consistent revenue going up. 

Recently, Jindal Stainless announced its plans to produce more than 1.9 billion units of clean electricity annually through various green energy initiatives. These efforts, including wind-solar hybrid, floating, and rooftop solar plants, aim to significantly reduce carbon emissions by over 13.52 lakh tonnes per year, as outlined in the company’s recently released Sustainability Report. Jindal Stainless has also partnered with ReNew Power to deliver 100 megawatts of round-the-clock renewable energy as part of their commitment to sustainable practices. 

The company has a market capitalization of Rs 49,241 crore, with its current stock price at Rs 598. The stock has seen a high of Rs 603 and a low of Rs 230. With a stock P/E of 18.6 and a book value of Rs 161, the company has a dividend yield of 0.25%. It boasts a strong financial performance, with an ROCE of 20.8%, ROE of 19.1%, and a sales growth of 40.2% over the past 3 years and 20.3% presently. The company has a conservative debt-to-equity ratio of 0.43 and a price-to-book value of 3.72. 

In comparison to the industry, it has a higher P/E ratio of 18.6 against the industry average of 16.3. The promoter holds a significant 58.0% stake, indicating confidence in the business. The company has shown a profit after tax of Rs 2,638 crore. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions. 

 

Open Free Demat Account!

Enjoy Zero Brokerage on Equity Delivery

Join our 1.75 Cr+ happy customers

+91
Enjoy Zero Brokerage on Equity Delivery
4.4 Cr+DOWNLOADS
Enjoy Zero Brokerage on Equity Delivery

Get the link to download the App

Send App Link

Enjoy Zero Brokerage on
Equity Delivery