Monopoly stocks refer to shares of companies that dominate their industry or market with little to no competition. These companies often have a strong market presence, pricing power, and the ability to generate consistent profits.
A stock’s Price-to-Earnings Growth (PEG) ratio is a valuable metric used to evaluate a stock’s valuation while considering its earnings growth. A PEG ratio of less than 1 suggests the stock is undervalued relative to its growth rate. The stocks to keep under your radar
Hindustan Aeronautics Limited
Hindustan Aeronautics Limited (HAL) is a leading aerospace and defense company in India, specializing in the design, development, and manufacturing of aircraft, helicopters, and avionics. HAL holds a dominant position in the Indian aerospace sector, serving both civilian and military markets. It enjoys a near-monopoly in India’s defense aircraft manufacturing space, making it a critical player in the country’s defense and aerospace infrastructure.
The stock has a PEG (Price-to-Earnings Growth) ratio of 0.77, which indicates that it is undervalued relative to its earnings growth potential. Additionally, the company’s ROE stands at 27.3 percent, and the ROCE of 25.29 percent.
The company’s revenue rose by 16.3 percent from Rs. 6,521.26 crore to Rs. 7,588.71 crore in Q3FY24-25. Meanwhile, Net profit rose from Rs. 1,261.4 crore to Rs. 1,439.83 crore during the same period.
Computer Age Management Services Limited
Computer Age Management Services (CAMS) is a leading provider of investor and financial services in India, specializing in mutual fund registrar and transfer agent services. CAMS dominates the sector, handling over 60 percent of India’s mutual fund assets. CAMS has secured a near-monopoly in the mutual fund industry, making it a critical player in India’s financial ecosystem.
The stock has a PEG (Price-to-Earnings Growth) ratio of 0.97, which indicates that it is undervalued relative to its earnings growth potential. Additionally, the company’s ROE stands at 41.11 percent, and a ROCE of 48.22 percent.
The company’s revenue rose by 28.4 percent from Rs. 299.59 crore to Rs. 384.68 crore in Q3FY24-25. Meanwhile, Net profit rose from Rs. 89.29 crore to Rs. 125.49 crore during the same period.
Central Depository Services (India)
Central Depository Services Limited (CDSL) is a leading depository in India, providing services related to the electronic holding and transfer of securities. CDSL holds a dominant position in the market, offering a range of services to investors, brokers, and issuers. The company has a near-monopoly in the Indian securities depository space, making it a crucial component of India’s financial infrastructure.
The stock has a PEG (Price-to-Earnings Growth) ratio of 0.78, which indicates that it is undervalued relative to its earnings growth potential. Additionally, the company’s ROE stands at 34.85 percent, and the ROCE of 46.12 percent.
The company’s revenue rose by 26.3 percent from Rs. 235.96 crore to Rs. 298.11 crore in Q3FY24-25. Meanwhile, Net profit rose from Rs. 107.42 crore to Rs. 130.1 crore during the same period.
Written by Sridhar J
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