PSUs, or public sector undertakings, are closely linked to the core sectors of the economy and have successfully built the country’s industrial base. The Government of India owns the majority of these businesses.
Here are three PSU stocks that doubled in 2023
REC Limited
The REC is a Central Public Sector Undertaking of the Ministry of Power that finances projects across the entire power sector value chain, from generation to distribution.
On Friday, the share price of the company closed at 3.1 up Rs 407.20 from its previous close of Rs 394.60 the market capitalization of the company is Rs 1,07,000 Crores.
According to the company’s financial statements, net revenues increased by 17 percent from Rs 9,955 crores in Q2FY23 to Rs 11,688 crores in Q2FY24. During the same period, net profit also increased by 38 percent, from Rs 2,732 crores to Rs 3,789 crores.
The company’s share price has increased by 238 percent over the past year and by 173 percent over the previous six months. For instance, if an investor invested Rs 1 Lakh last year the current value would be 3.38 lakhs.
REC Limited’s return on equity is 20 percent, its return on capital employed is 9 percent, and the company has a good dividend yield of 3.19 percent with a net profit margin of 28 percent.
Power Finance Corporation
Power Finance Corporation Limited is a Systemically Important Non-Deposit NBFC registered with the RBI as an Infrastructure Finance Company. It is providing financial assistance to the Indian power sector.
On Friday, the share price of the company closed at 2.29 up Rs 385.75 from its previous close of Rs 371.10 the market capitalization of the company is Rs 1,27,446 Crores.
Looking at the company’s financial statements net revenues rose 15 percent from Rs 19,336 crore in Q2FY23 to Rs 22,391 crore in Q2FY24, Furthermore, net profit increased 26 percent from Rs 5,229 crore to a net profit of Rs 6,628 crore during the same period.
The share price of the company has risen by 142 percent in six months and 222 percent in the last year. For instance, if an investor invested Rs 1 Lakh last year the current value would be 3.22 lakhs.
Power Finance Corporation has a low price-to-earnings ratio of 7 compared to its peer companies, a return on equity ratio of 27 percent, a return on capital employed of 9 percent, has dividend yield of 8.7 percent, and with net profit margin of 27 percent.
Rail Vikas Nigam Ltd
Rail Vikas Nigam Ltd was established in 2003 by the Government of India to carry out various types of rail infrastructure projects assigned by the Ministry of Railways, such as doubling, gauge conversion, new lines, railway electrification, major bridges, workshops, Production Units, and freight revenue sharing.
On Friday, the share price of the company closed at 0.65 down Rs 171.20 from its previous close of Rs 170.10 the market capitalization of the company is Rs 35,716 Crores.
Looking at the company’s financial statements net revenues rose 0.11 percent from Rs 4,908 crores in Q2FY23 to Rs 4,914 crores in Q2FY24, Furthermore, net profit increased 22 percent from Rs 302 crores to a net profit of Rs 370 crores during the same period.
The share price of the company has risen by 36 percent in six months and 149 percent in the year to date. For instance, if an investor invested Rs 1 Lakh year to date the current value would be 2.49 lakhs.
Rail Vikas Nigam Limited has a low price-to-earnings ratio of 24 compared to its peer companies, a return on equity ratio of 20 percent, a return on capital employed of 17 percent, has dividend yield of 3.1 percent, and a low debt-to-equity ratio of 0.88.
Written by Sriram KV
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