In the dynamic world of stock markets, finding gems that promise long-term growth is a treasure hunt. This article is shining a spotlight on five fundamentally strong stocks for long term that are catching investors’ eyes. From coal mining to pharmaceuticals, these diverse businesses are demonstrating robust financial performance and promising future prospects.
Moreover, we are delving into their key metrics, market positions, and growth strategies. Furthermore, this analysis is providing valuable insights for investors seeking potential long-term opportunities in the Indian stock market. Additionally, we are exploring how these companies are adapting to changing market conditions and industry trends.
List Of Fundamentally Strong Stocks for Long term
Coal India
Coal India, established in 1975, is currently operating as India’s largest coal producer. The company is managing coal reserves and infrastructure across the country. Furthermore, the company is showing strong financial performance with increasing revenue and net profit. Coal India’s revenue has grown from ₹138,252 Cr in 2023 to ₹142,324 Cr, while its net profit has risen from ₹31,723 Cr to ₹37,369 Cr.
Consequently, the company is maintaining high ROCE (63.6%) and ROE (52.0%). Meanwhile, its 10-year OPM stands at 24.2%, indicating consistent operational efficiency. Coal India is continuously expanding its production capacity and modernizing its mining operations. As a result, it is strengthening its position as a key player in India’s energy sector.
Future Outlook: Coal India is focusing on sustainable mining practices and diversifying into clean energy. Additionally, the company is investing in technology to improve productivity and reduce environmental impact. These efforts are positioning Coal India for long-term growth in the evolving energy sector. Furthermore, the company is exploring opportunities in renewable energy and coal gasification, enhancing its long-term sustainability prospects.
Key Metrics
| Particulars | Amount |
|---|---|
| Market Capitalisation | ₹ 3,19,106 Cr. |
| Current Market Price | ₹ 518 |
| Price to Earnings Ratio | 8.75 |
| Price to Book Value | 3.89 |
| Debt to Equity Ratio | 0.08 |
| Dividend Yield % | 4.90 % |
| FII Holdings | 8.39 % |
| DII Holdings | 23.2 % |
Mahanagar Gas
Mahanagar Gas, established in 1995, is currently operating as a leading natural gas distribution company in Mumbai. Moreover, it is supplying compressed natural gas (CNG) and piped natural gas (PNG) to various sectors. Furthermore, the company is showing strong financial performance with increasing revenue and net profit.
Mahanagar Gas’ revenue has grown from ₹1,184 Cr in 2023 to ₹1,843 Cr, while its net profit has risen from ₹790 Cr to ₹1,289 Cr. Consequently, the company is maintaining a healthy ROCE 36.6% and ROE 27.8%. Meanwhile, its 10-year OPM stands at 28.5%, indicating consistent operational efficiency. Besides, Mahanagar Gas is continuously expanding its distribution network and promoting natural gas as a clean fuel alternative. As a result, it is strengthening its position as a key player in India’s natural gas sector.
Future Outlook: Mahanagar Gas is focusing on expanding its distribution network and promoting natural gas adoption. Additionally, the company is investing in infrastructure to improve supply reliability and customer service. Consequently, these efforts are positioning Mahanagar Gas for growth in the expanding natural gas market. Furthermore, the company is exploring opportunities in renewable energy integration, enhancing its long-term sustainability prospects.
Key Metrics
| Particulars | Amount |
|---|---|
| Market Capitalisation | ₹ 18,175 Cr. |
| Current Market Price | ₹ 1,840 |
| Price to Earnings Ratio | 15.1 |
| Price to Book Value | 3.49 |
| Debt to Equity Ratio | 0.03 |
| Dividend Yield % | 3.67 % |
| FII Holdings | 31.5 % |
| DII Holdings | 16.7 % |
Natco Pharma
Natco Pharma, established in 1981, is currently operating as a vertically integrated pharmaceutical company in India. Moreover, it is developing, manufacturing, and marketing finished dosage formulations and active pharmaceutical ingredients. Furthermore, the company is showing strong financial performance with increasing revenue and net profit.
Natco Pharma’s revenue has grown from ₹2,707 Cr in 2023 to ₹3,999 Cr in 2024, while its net profit has risen from ₹715 Cr to ₹1,388 Cr. The company is also maintaining a solid ROCE 30.0% and ROE 25.9%. Meanwhile, its 10-year OPM stands at 33.8%, indicating robust operational efficiency. Natco Pharma is continuously expanding its product portfolio and strengthening its research and development capabilities. As a result, it is enhancing its position in both domestic and international pharmaceutical markets.
Future Outlook: Natco Pharma is focusing on expanding its product portfolio and entering new therapeutic areas. Additionally, the company is investing in research and development to drive innovation. These efforts are positioning Natco Pharma for growth in the competitive pharmaceutical industry. Furthermore, the company is exploring opportunities in biosimilars and complex generics, enhancing its long-term growth prospects.
Key Metrics
| Particulars | Amount |
|---|---|
| Market Capitalisation | ₹ 26,151 Cr. |
| Current Market Price | ₹ 1,460 |
| Price to Earnings Ratio | 16 |
| Price to Book Value | 4.4 |
| Debt to Equity Ratio | 0.06 |
| Dividend Yield % | 0.65 % |
| FII Holdings | 17.4 % |
| DII Holdings | 7.86 % |
Varun Beverages
Varun Beverages, established in 1995, is currently operating as PepsiCo’s largest franchisee bottler in India. The company is involved in producing and distributing carbonated soft drinks, non-carbonated beverages, and packaged drinking water. Furthermore, Varun Beverages’ revenue has grown from ₹2,863 Cr in 2022 (December) to ₹3,717 Cr in 2023 (December)(The company follows a January to December Financial Reporting Period), while its net profit has risen from ₹1,550 Cr to ₹2,102 Cr during the same period.
Consequently, the company is maintaining a solid ROCE 28.8% and ROE 35.2%, while its 10-year OPM stands at 20.8%, indicating consistent operational efficiency. Besides, Varun Beverages is continuously expanding its distribution network and diversifying its product portfolio. This has resulted the company in strengthening its position in the beverages market across multiple geographies.
Future Outlook: Varun Beverages is focusing on expanding its product portfolio and entering new markets. Additionally, the company is investing in automation and sustainability initiatives to improve efficiency. As a result these efforts have positioned Varun Beverages for growth in the dynamic beverage industry. Furthermore, the company is exploring opportunities in healthier beverage options, enhancing its long-term market relevance.
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Key Metrics
| Particulars | Amount |
|---|---|
| Market Capitalisation | ₹ 1,95,794 Cr. |
| Current Market Price | ₹ 1,507 |
| Price to Earnings Ratio | 80.8 |
| Price to Book Value | 22.8 |
| Debt to Equity Ratio | 0.79 |
| Dividend Yield % | 0.18 % |
| FII Holdings | 25.3 % |
| DII Holdings | 4.54 % |
Trent
Trent, established in 1998, is a leading retail company in India, operating under the Tata Group. The company manages popular retail formats including Westside, Zudio, and Star Bazaar. Trent has shown robust financial growth, with revenue increasing from ₹8,242 Cr in 2023 to ₹12,375 Cr in 2024, while its net profit rose from ₹394 Cr to ₹1,477 Cr during the same period. The company maintains a strong ROCE 23.8% and ROE 27.2%. Its 10-year OPM stands at 12.2%, reflecting steady operational performance. Trent is continuously expanding its store network and enhancing its omni channel presence. As a result, it is solidifying its position as a key player in India’s retail sector.
Future Outlook: Trent is focusing on expanding its value fashion segment and strengthening its online presence. Additionally, the company is investing in supply chain optimization and customer experience enhancement. These efforts are positioning Trent for sustained growth in the evolving retail landscape. Furthermore, the company is exploring opportunities in new retail formats and private labels, enhancing its long-term growth prospects.
Key Metrics
| Particulars | Amount |
|---|---|
| Market Capitalisation | ₹ 2,48,930 Cr. |
| Current Market Price | ₹ 7,002 |
| Price to Earnings Ratio | 199 |
| Price to Book Value | 61.2 |
| Debt to Equity Ratio | 0.43 |
| Dividend Yield % | 0.05 % |
| FII Holdings | 27.9 % |
Conclusion
As we are concluding our exploration of these five fundamentally strong stocks for long term, it is becoming clear that they are positioning themselves for sustained growth. Furthermore, their strong financial performance, strategic initiatives, and market adaptability are making them attractive prospects for long-term investors.
However, it is important to remember that market conditions are constantly evolving. Therefore, investors are advised to conduct thorough research and consider their risk tolerance before making investment decisions. Additionally, keeping an eye on these companies’ future developments could prove beneficial for those seeking to diversify their portfolios with Indian stocks.
Question for readers: How might the global push for clean energy affect Coal India’s long-term prospects, and what strategies could the company employ to remain relevant? Which of these five companies do you think has the most potential for international expansion, and why? Comment below.
Written By Dipangshu Kundu
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