Public Sector Undertakings (PSUs) have long been the backbone of India’s economic and industrial development. From energy and infrastructure to finance and defence, these government-backed giants are known for their stability, scale, and solid track records. Despite their prominence, only a small portion of them are currently listed on the stock market.

As of April 30, 2025, only 70 of the 389 Central Public Sector Enterprises (CPSEs) and their subsidiaries are publicly traded. Of these, 67 are listed on the Bombay Stock Exchange (BSE). And the story doesn’t end there. Many profitable CPSEs are still waiting to go public, opening up even more opportunities for investors in the near future. Check out the PSU stocks list by market capitalisation in this blog. 

What is a PSU Stock?

PSU stocks are shares of companies where the Indian government owns at least 51% of the stake. These companies were initially set up to help drive the country’s economic growth, reduce the dominance of private monopolies, and promote balanced development across different regions of India.

Here’s a quick breakdown of the types of PSUs:

  • Central Public Sector Enterprises (CPSEs): These are companies in which the central government or other CPSEs hold 51% or more of the ownership.
  • Public Sector Banks (PSBs): These are banks that the central or state government (or other PSBs) owns at least 51% of.
  • State Level Public Enterprises (SLPEs): These are companies in which the state government or other SLPEs have a majority 51% or more stake.

Best PSU Stocks in India by Market Capitalisation  

Here is the best PSU stocks list with prices, including PSU bank stocks:

SNo.Company’s Name Market Cap (₹ crore)  
1.State Bank of India 7,09,418
2.Life Insurance Corporation of India (LIC)5,40,629
3.Hindustan Aeronautics Ltd3,35,484
4.NTPC Ltd  3,34,680
5.Oil And Natural Gas Corporation Ltd (ONGC) 3,10,229

Overview of the Top PSU Stocks in India 

In this section, let us discuss each PSU stock in detail: 

1. State Bank of India (SBI)

SBI is India’s largest and oldest bank headquartered in Mumbai. It has a presence in insurance (SBI Life, SBI General), mutual funds (SBI MF), credit cards (SBI Card), and more. The bank operates in 244 offices across 29 countries. As of FY25, SBI remains the largest bank in India with a total business (advances + deposits) of ₹95 lakh crore. Its extensive network includes 22,937 branches, 78,000+ business correspondent outlets, and 63,791 ATMs. SBI holds a 22.54% market share in deposits and 19.36% in advances in India. 

The bank offers services through WhatsApp banking, instant digital loans, cross-selling platforms, and integrated payment solutions like QR codes, POS machines, and online credit facilities. As a result, over 98% of all transactions now take place through its digital channels, including Internet banking, Mobile apps, UPI, and the YONO platform.

In terms of financial performance for FY25, SBI recorded advances worth ₹42 lakh crore, marking a 12.03% increase over the previous year. Deposits grew by 9.48% to ₹53 lakh crore. The bank’s Net Interest Income (NII) rose to ₹1,66,965 crore, reflecting a year-on-year growth of 4.43%, while its net profit increased by 16.08% YoY. 

2. Life Insurance Corporation of India (LIC) 

LIC is India’s largest life insurance company. As of FY25, the company commands 57.05% of the total business premium and holds a massive 65.83% market share by number of policies. LIC provides many participating and non-participating life insurance products. 

As of FY25, LIC introduced four new non-participating insurance products designed to cater to a younger, more digitally savvy audience. These include LIC’s Yuva Credit Life, LIC’s Digi Term, LIC’s Yuva Term, and LIC’s Digi Credit Life. The insurer boasts a vast and diverse distribution network comprising over 14.87 lakh exclusive agents, 183 corporate agents, and 162 insurance marketing firms, among other channels.

On the financial front, LIC continues to post strong results. In FY25, its total premium income rose to ₹4,88,148 crore, marking a 2.75% year-on-year increase. Profit after tax for the same period stood at ₹48,151 crore, reflecting an 18.38% YoY growth. On the business front, LIC is working to expand its market share across all segments by launching new products, especially in the non-participating category, to fill gaps in its portfolio.

In FY25, LIC delivered solid profitability, with impressive growth in its high-margin non-par business, even as it tackled challenges like slower policy volumes and persistency issues. Management remains focused on refining the product mix, driving digital transformation, and keeping a close eye on costs, all while adapting to evolving regulations and rising competition. 

3. Hindustan Aeronautics Ltd (HAL) 

HAL is one of India’s most strategic defence and aerospace players formed in 1964. Today, it is recognised as a prestigious ‘Maharatna’ PSU, a status granted to India’s top-performing public sector enterprises. It collaborates with the Indian Space Research Organisation (ISRO), manufacturing structural parts for India’s satellite launch vehicles and supporting the country’s ambitions in space. The company also supplies critical equipment to the Navy, Indian Air Force, Army, and Coast Guard. It relies heavily on contracts from the Ministry of Defence, making government orders the lifeblood of its operations.

In the financial year ending March 31, 2025, HAL reported steady growth in its performance. The company’s net profit rose to ₹8,364 crore, reflecting a 9.7% increase from ₹7,621 crore in FY24. Revenue from operations remained largely stable at ₹30,981 crore in FY25, compared to ₹30,381 crore in the previous year. HAL also reported an Earnings Per Share (EPS) of ₹125.07. 

The company’s order book stood at an impressive ₹1.84 lakh crore, up from ₹94,129 crore the previous year. The increase comes from bagging new manufacturing contracts worth ₹1.02 lakh crore, along with repair & overhaul (ROH) contracts valued at ₹17,500 crore.

The company is also undergoing a major transformation, from being a manufacturer under foreign licences to building indigenous capabilities. It is actively working on several homegrown projects, including:

  • Tejas Mk1 and Tejas Mk1A fighter jets
  • Su-30 modernisation program
  • Dornier-25 aircraft
  • Light Utility Helicopter (LUH)

4. National Thermal Power Corporation Ltd (NTPC)

NTPC, a Maharatna company, is India’s largest power generation company. Through its joint ventures, subsidiaries, and associate companies, NTPC generates and sells bulk power to state utilities across India. The group is also active in energy trading, consultancy and project management, oil and gas exploration, coal mining, and renewable energy projects, including wind and solar.

The company has an installed capacity of 76,598 MW, which contributes roughly 17% of India’s total power capacity. The group is currently developing an additional 30 GW of capacity across both thermal and renewable energy segments. In line with its long-term clean energy goals, NTPC is now venturing into nuclear power. It has set up:

  • ASHVINI, a joint venture with the Nuclear Power Corporation of India Ltd., to develop large-scale nuclear projects like the 2,800 MW Mahi Banswara plant.
  • NTPC ParmanU Urja Nigam Ltd., a fully owned subsidiary focused on overseeing its nuclear energy initiatives. 

In FY25, NTPC reported a total income of ₹1,90,862 crore, marking a 5% year-on-year increase from ₹1,81,166 crore in FY24. Profit After Tax (PAT) also saw healthy growth, rising 12% to ₹23,953 crore from ₹21,332 crore in FY24. Looking at the company’s consolidated capital expenditure, it’s projected to be ₹55,920 crore in FY26, jump to ₹97,363 crore in FY27, and ₹1,12,172 crore in FY28. 

5. Oil And Natural Gas Corporation Ltd (ONGC) 

ONGC is India’s largest producer of crude oil and natural gas, contributing 71% of the country’s total crude oil output. The company is involved in the exploration and production (E&P) of crude oil and natural gas. The crude oil it extracts is sold to Indian refineries at international benchmark prices. 

Beyond India, ONGC has built a global footprint through joint ventures and strategic partnerships in Norway, Vietnam, Tunisia, Egypt, Iran, and Australia. This global arm is operated through ONGC Videsh, which handles overseas exploration, development, and production.

In FY25, the company made nine discoveries, five onshore and four offshore. Looking ahead, it has laid out an ambitious exploration roadmap, targeting 3 lakh sq km in FY26 and further to 4 lakh sq km in FY27. 

Despite its operational strength, ONGC’s financial performance took a hit in the fourth quarter of FY25. The company reported a 20% YoY decline in net profit for the fourth quarter, falling to ₹8,856 crore from ₹11,096 crore in the corresponding period last year. For the full financial year 2024–25, profit dropped to ₹38,328 crore. 

Factors to Consider Before Investing in PSU Stocks 

When looking at PSU stocks, investors should weigh these key factors:

  • Government Policies and Reforms: Government decisions directly impact PSU performance, especially in regulated sectors like banking and energy. For instance, in July 2022, the Indian government imposed a windfall tax on domestic crude oil producers and fuel exporters such as ONGC and Oil India Ltd. The move aimed to capture the extraordinary profits these companies were earning amid soaring global crude prices triggered by the Russia-Ukraine war. As a result, the share prices of both ONGC and Oil India declined sharply following the announcement.
  • Disinvestment Plans: The government’s ongoing disinvestment program where it sells its stake in PSUs to raise funds or improve efficiency, can affect stock prices both positively and negatively depending on implementation.
  • Dividend Yields: Many PSUs offer attractive dividend payouts making them popular among income-focused investors.
  • Sector Dynamics: Understanding sector-specific challenges and opportunities remains crucial when evaluating PSU stocks. For instance, power sector PSUs like NTPC face challenges such as delayed payments from state electricity boards and regulatory bottlenecks, while they also benefit from opportunities like government-led renewable energy initiatives and infrastructure investments. Similarly, defence PSUs such as HAL and Bharat Electronics Ltd. are gaining from rising defence budgets and the push for indigenisation. 

Final Thoughts 

PSU stocks generally have the advantage of government backing, market leadership, and lower valuation metrics from private sector counterparts. These characteristics often attract those looking for stability in their portfolios.But these public sector enterprises face their own set of challenges. Political considerations sometimes influence business decisions, bureaucratic processes can slow responses to market changes, and they compete with quick-moving private companies. Each PSU comes with its own strengths, weaknesses, and sector dynamics that shape its market performance. Thus, if you want to invest in a PSU stock, assess them carefully and choose one that fits your financial profile.

Disclaimer: Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Registration granted by SEBI, enlistment as a Research Analyst with the Exchange and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. The securities are quoted as an example and not as a recommendation.

This is for informational purposes and should not be considered as recommendations. Kindly refer to  https://www.share.market/ for more details. PhonePe Wealth Broking Private Limited, Research Analyst with SEBI Regn No: INH000013387, BSE RA Enlistment Number: 5887.

FAQs

1. What are PSU stocks?

PSU stocks are shares of government-owned companies where the government holds a majority stake (51% or more).

2. Are PSU stocks safe to invest in?

PSU stocks are generally considered safer due to government backing. However, like any equity investment, they are subject to market risks. It’s best to research individual companies and diversify.

3. Which PSU stock is best to buy?

Some of the best PSU stocks as per market capitalisation are, State Bank of India, Life Insurance Corporation of India (LIC), Hindustan Aeronautics Ltd., NTPC and Oil And Natural Gas Corporation Ltd (ONGC).

4. How can I buy PSU stocks in India?

You can buy PSU stocks through any registered stockbroker, like Share.Market, on Indian exchanges like NSE and BSE. Simply open a demat and trading account, fund it, and place your order.

5. Is diversification important when investing in PSU sector stocks?

Yes, diversification helps reduce risk and balances exposure across different sectors and companies.