The Indian stock market in 2024 is set for a promising trajectory with anticipated gains across major indices and sectors.
Over the past two decades, India’s stock market has consistently outperformed both developed and emerging markets, indicating robust investor confidence and economic resilience.
Here are a few stocks that have established themselves as a vital player in the Indian financial market, showcasing strong fundamentals that contribute to their longevity and reliability:
Central Depository Services (India) Limited
CDSL plays a key role in facilitating the holding and transaction of securities in electronic form. As of March 2024, CDSL reported servicing over 11.56 crore demat accounts, making it a cornerstone for investors across India.
CDSL has maintained its leadership position in the market. It opened over 3.26 crore new demat accounts during FY23-24, with a record 1.09 crore accounts opened in Q4 alone, marking the highest quarterly registration in its history.
As of June 2024, CDSL holds a 77 percent market share in demat accounts and is the only depository securities company listed in the Indian stock market. Recent reports show CDSL managing over 5.85 crore active demat accounts, highlighting its extensive reach and capacity.
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CDSL has also maintained a debt-free status for the last five years, which enhances its financial stability and reduces risk exposure, driving investor’s confidence.
As more individuals open demat accounts and engage in trading, the transaction volume increases, leading to higher revenue for CDSL. In recent years, CDSL has witnessed a notable increase in transactions, with a growth rate jumping from 7.86 percent in FY23 to 16 percent in FY24.
CDSL’s market capitalisation stands at Rs. 30,717.8 crores, with a P/E ratio of 63.8. The stock price has shown exceptional growth, with a 5-year return of nearly 1320.3% and a 1-year return of about 117.8 percent.
Founded in 1999, Central Depository Services (India) Limited, the country’s largest depository, is a Market Infrastructure Institution (MII) and part of the capital market structure.
It is a facilitator for the holding of securities in the dematerialised form and provides services to all market participants – exchanges, clearing corporations, depository participants (DPs), issuers and investors. Multi Commodity Exchange of India Limited
India’s leading commodity derivatives exchange, Multi Commodity Exchange of India Limited or MCX, serves as a key platform for commodity trading in India, facilitating the buying and selling of various commodities such as metals, energy, and agricultural products.
MCX commands a dominant market share of nearly 97.84 percent in the value of commodity futures contracts traded in India, making it the foremost exchange in this sector.
The company has formed strategic alliances with prominent international exchanges like the CME Group and the London Metal Exchange (LME).
These partnerships facilitate knowledge sharing and enhance MCX’s operational capabilities, allowing it to integrate more seamlessly into the global commodities ecosystem. Such collaborations are crucial for maintaining competitiveness in an increasingly interconnected market.
Despite facing challenges such as market fluctuations and regulatory scrutiny, MCX has shown resilience. For instance, after experiencing a dip due to negative pricing issues in crude oil futures, it successfully recovered by capitalising on increased trading volumes in gold and silver futures during periods of economic uncertainty. This adaptability is vital for sustaining long-term growth.
The market capitalisation of MCX stands at Rs. 29,394 crores, with a P/E ratio of 169. The stock price has shown exceptional growth, with a 5-year return of nearly 470 percent and a 1-year return of about 197.4 percent.
BSE Limited
Founded in 1875, BSE Limited (formerly known as Bombay Stock Exchange Limited) is Asia’s first stock exchange and one of India’s leading exchange groups.
Over the past 149 years, BSE has provided a capital-raising platform and played a pivotal role in providing a platform for trading in equity, debt instruments, derivatives, and currencies, making it integral to the financial ecosystem. It also has a platform for trading in equities of small and medium enterprises (SMEs).
The BSE SENSEX, India’s primary stock market index, recorded an increase of about 19 percent since the beginning of 2024, reaching new highs.
A consistently rising index like the SENSEX helps position India as an attractive investment destination on a global scale. This can lead to increased participation from foreign institutional investors (FIIs), further driving market stability and growth potential.
The market is growing vastly in terms of the number of registered investors & turnover, and BSE is focused on increasing market share across all segments. As of Q1 FY25, the market cap of BSE-listed companies stood at $5.27 trillion, with over 18.4 crores of registered investors, and 43 registered Mutual Funds.
The market capitalisation of BSE stands at Rs. 50,373.5 crores, with a P/E ratio of 84.3. The stock price has shown exceptional growth, with a 5-year return of nearly 1860% and a 1-year return of about 184 percent.
In a nutshell, the combination of strong market leadership, diverse product offerings, strategic global partnerships, technological innovation, and resilience against market challenges positions these stocks as powerful players in the Indian financial market. Together, they contribute to their potential for long-term success as the financial markets evolve.
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Written by Shivani Singh
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