Return on PSU Stocks: In just two years, PSU stocks increased from 1 lakh to 10 lakhs, yielding excellent returns


Rajasthan News


PSU Stocks Are Making a Strong Comeback

Public Sector Undertaking (PSU) stocks are experiencing a remarkable resurgence in the market, thanks to proactive government initiatives aimed at bolstering infrastructure, significantly increasing government spending, and enhancing overall governance practices. These concerted efforts have positively impacted numerous PSU companies, resulting in substantial share price increases ranging from an impressive 500% to an extraordinary 950%.

Multibagger PSU Stocks: Exceptional Returns Await Investors

As an investor, you always seek solid and reliable returns on your investments, and certain government companies have delivered outstanding performance in this regard. Known as PSU shares, these stocks have been instrumental in driving the BSE PSU index, which has surged nearly 100% in just one year. This remarkable growth is primarily attributed to the soaring prices of select PSU company stocks. According to recent reports, shares of three notable PSU companies have generated phenomenal profits over the past two years. For instance, if you had invested ₹1 lakh in these companies, your investment would now have skyrocketed to approximately ₹10 lakh, demonstrating the incredible potential of these stocks.

Mazagon Dock Shipbuilders has experienced the highest growth trajectory among these standout performers. The share price of Mazagon Dock soared dramatically from ₹234.85 to ₹3,968.25 by June 2024, marking an astounding increase of 1,590%. Similarly, Cochin Shipyard and Rail Vikas Nigam Limited (RVNL) have also delivered impressive returns of over 1,000%, showcasing the strong performance of PSU stocks in the current market landscape. In simple terms, if you had invested ₹1 lakh in shares of these companies two years ago, your investment would now be worth around ₹10 lakh, highlighting the lucrative opportunities available in this sector.

Many PSU Companies Reap Significant Benefits

Public Sector Undertaking (PSU) stocks are experiencing a notable resurgence, largely driven by proactive government initiatives. These efforts encompass improvements in infrastructure, increased government spending, and enhanced governance practices. As a result, many PSU companies have reaped substantial benefits, with share prices soaring by an impressive 500% to 950%. Notable examples include Fertilizers and Chemicals Travancore, Indian Railway Finance Corporation, and Housing & Urban Development Corporation, all of which have demonstrated remarkable growth.

Overall, the BSE Sensex has witnessed a robust increase of 50% in recent times, while the market share of PSU companies has surged from 10.5% to an impressive 17.5% in FY 2022. This trend reflects the growing confidence in the PSU sector.

Motilal Oswal Financial Services anticipates that government companies’ (PSUs) profits will continue to rise in the coming years. Their analysis suggests that a strong order book and elevated raw material prices position these companies favorably. Additionally, the government’s focus on enhancing domestic manufacturing capabilities and promoting indigenization in the defense sector is expected to benefit industrial PSU companies significantly. As a result, their earnings and market value are likely to experience further growth, making them attractive prospects for investors.

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