Before investing in any stock, it is essential to conduct thorough fundamental research to minimise potential losses. There are various parameters through which this research can be completed. One such indicator is EPS, or Earnings Per Share, which represents a company’s profitability, operational efficiency, etc.
In today’s blog post, we will give you an overview of the best high EPS stocks in India, along with the benefits of investing in them.
What are High EPS Stocks?
High EPS stocks are the shares of those companies which generate high profits, with respect to outstanding shares. This financial metric is used by the investor to evaluate the company’s profitability and its financial health. Companies with high EPS are those which consistently post strong profitability over time.
Top High EPS Stocks to Buy in India
- Akzo Nobel India Limited
- Hindustan Petroleum Corporation Limited
- National Aluminium Company Limited
- Bharat Petroleum Corporation Limited
- Chambal Fertilisers & Chemicals Limited
- General Insurance Corporation of India
- Power Finance Corporation Limited
- REC Limited
- NMDC Limited
- LIC Housing Finance Limited
| Company | Current Market Price (INR) | Market Capitalisation (in INR crore) | 52-Week High | 52-Week Low |
|---|---|---|---|---|
| Akzo Nobel India Limited | 3,616 | 16,467 | 3,958 | 3,022 |
| Hindustan Petroleum Corporation Limited | 464 | 98,730 | 495 | 288 |
| National Aluminium Company Limited | 276 | 50,755 | 280 | 138 |
| Bharat Petroleum Corporation Limited | 366 | 1,59,223 | 382 | 234 |
| Chambal Fertilisers & Chemicals Limited | 446 | 17,893 | 742 | 410 |
| General Insurance Corporation of India | 378 | 66,360 | 526 | 351 |
| Power Finance Corporation Limited | 336 | 1,10,965 | 513 | 335 |
| REC Limited | 336 | 88,476 | 566 | 335 |
| NMDC Limited | 77 | 67,916 | 79 | 59 |
| LIC Housing Finance Limited | 527 | 29,007 | 647 | 484 |
Overview of Best High EPS Stocks in India
The detailed overview of the best high EPS stocks in India is as follows:
1. Akzo Nobel India Limited
Akzo Nobel India Limited company started operations in 1954, and it was a subsidiary of AkzoNobel N.V., which was a leader in paints, coatings, etc. It expanded into various entities and later consolidated its business units into a single entity. It focuses on decorative paints, coatings for both industrial and automotive usage. The company’s headquarters is situated in Haryana.
2. Hindustan Petroleum Corporation Limited
Lube India Limited and Esso Standard were merged to form HPCL in 1974. In 1992, the company became the first public sector company to list on the Bombay Stock Exchange. The company was made a Maharatna after achieving a profit of 10644 crore. In India, it operates through a network of over 17,000 gas stations, of which 40% are found in urban areas, and the rest are situated on highways and in rural areas. The company is headquartered in Mumbai.
3. National Aluminium Company Limited
National Aluminium Company Limited company was incorporated in 1981 to enhance the country’s aluminium production capacity. It established offices in Singapore and Dubai and became a prominent player in the aluminium export industry. In 2011, the company received the status of Navratna. The company is currently focusing on the expansion of its mining and refineries, as well as renewable energy sources. The head office of the company is situated in Odhisha.
4. Bharat Petroleum Corporation Limited
BPCL was established in 1952 by Burmah Shell and the Indian government in the form of a joint venture. In 1976, the Indian government bought Burmah Shell, thus turning BPCL into a wholly owned government company. The company is involved in the exploration, refining, distribution, marketing, and sale of petroleum and petroleum-related products. The Ministry of Petroleum and Natural Gas of the Indian government controls it. The company was given the status of Maharatna Company, and its headquarters are located in Mumbai.
5. Chambal Fertilisers & Chemicals Limited
Chambal Fertilisers & Chemicals Limited founded in 1985 as a part of the K.K. Birla Group. It was initially known by the name Aravali Fertilisers Limited, and later in 1989, it was renamed as Chambal Fertilisers Limited. The company manufactures high-quality fertilisers, ureas, etc. The company launched its IPO in 1993. The company’s headquarters is situated in New Delhi.
7. General Insurance Corporation of India
In 1972, the company General Insurance Corporation was established and incorporated under the General Insurance Business (Nationalist) Act. It formed four subsidiaries, which were called National Insurance Company, New India Assurance, oriental Insurance and United India Insurance. In the year 2017, the company issued its IPO, which happened to be among the largest insurance IPO in India. GIC functions under the Ministry of Finance. The company’s head office is situated in Mumbai.
8. Power Finance Corporation Limited
Power Finance Corporation Limited is one of the biggest public sector companies in India that provides funding to the power industry. The PFC was set up in 1986 and provides funding to projects which are involved with power generation, transmission, and distribution. The company is also engaged in renewable energy projects and helps with the execution of a number of government programs. The headquarters of the company is in New Delhi.
9. REC Limited
In 1969, the Rural Electrification Corporation Limited (REC) was formed with an objective to construct the infrastructure needed for rural electrification. The company went public in 2008 and became a publicly listed company. The Government of India gave it the title of “Navratna” later that year. The company’s headquarters is in New Delhi.
10. NMDC Limited
The government of India formed NMDC in 1958 to exploit the mineral resources. This company was first involved in the exploration of iron ore, copper, etc. Since its operations started in iron mining, it has diversified to diamond, gold, etc mining. In 2008, the company was granted the status of Navratna. In 2010, NMDC issued an IPO and became a publicly traded company. The head office of the company is located in Telangana.
11. LIC Housing Finance Limited:
Housing Finance Limited. LIC was founded in 1989 as a subsidiary of Life Insurance Corporation of India, the goal of which was to offer affordable housing loans to societies. In 2008, it set up a subsidiary in Dubai to offer its services to Indians living in the Gulf cities. Its IPO was introduced in 1994, and the company turned into a publicly traded company. The company has its headquarters in Mumbai.
Read Also: 10 Low PE Ratio Stocks in India
Key Performance Indicators (KPIs)
| Company | Debt to Equity | ROE (%) | ROCE (%) | Operating Profit Margin (%) | Net Profit Margin (%) | EPS |
|---|---|---|---|---|---|---|
| Akzo Nobel India Limited | 0 | 32.31 | 39.88 | 14.16 | 10.49 | 94.31 |
| Hindustan Petroleum Corporation Limited | 1.30 | 13.16 | 22.05 | 2.87 | 1.57 | 31.66 |
| National Aluminium Company Limited | 0.01 | 29.58 | 37.11 | 42.85 | 31.71 | 28.68 |
| Bharat Petroleum Corporation Limited | 0.63 | 16.38 | 16.30 | 4.73 | 2.72 | 31.21 |
| Chambal Fertilisers & Chemicals Limited | 0 | 18.89 | 23.14 | 14.22 | 9.11 | 41.17 |
| General Insurance Corporation of India | 0 | 12.08 | 11 | 19.69 | 14.05 | 42.36 |
| Power Finance Corporation Limited | 8.25 | 19.52 | 65.86 | 96.99 | 28.65 | 69.67 |
| REC Limited | 6.38 | 20.41 | 68.85 | 96.24 | 28.18 | 60.20 |
| NMDC Limited | 1.34 | 12.72 | 9.40 | 30.21 | 20.96 | 20.34 |
| LIC Housing Finance Limited | 7.44 | 14.97 | 71.54 | 93.93 | 19.35 | 98.95 |
Benefits of Investing in High EPS Stocks in India
The key benefits of investing in high EPS stocks in India are as follows:
- High Profitability: Stocks with high EPS have strong fundamentals and a business model. They consistently generate profit, which makes them more reliable during economic downturns.
- Low Risk: Investment in stocks having high EPS generates profit in the long run and tends to have lower risk than other companies because of high cash reserves and less debt.
- Positive Sentiments: These stocks generally have positive market sentiments because they attract investments from the FIIs, DIIs, etc.
Factors to Consider Before Investing in High EPS Stocks in India
The key factors which one should consider before investing in high EPS stocks are as follows:
- Company’s Financials: Before investing in any stock with high EPS, one must check its financial performance. The company’s revenue must be increasing and have high profit margins.
- No One-Time Gain: There should not be a one-time gain or profit, as it may raise EPS in a particular year.
- Competition: An investor needs to check for the company’s competition before investing. EPS cannot be the only parameter to invest in a company.
Read Also: List Of Best Paper Stocks in India
Conclusion
To sum up, investing in businesses where there is a high EPS will give you a chance to generate wealth over a long period. When EPS is high, it indicates that it is profitable, growing, and it is efficient in creating wealth for the shareholders in the long run. But investment based only on EPS is not a good one, and one should check other parameters and then make an investment, and can consult their investment advisor.
Frequently Asked Questions (FAQs)
What is the full form of EPS?
The full form of EPS is Earnings Per Share.
Name some stocks which have high EPS?
The stocks which have high EPS are Bharat Petroleum Corporation Limited, National Aluminium Company Limited, Hindustan Petroleum Corporation Limited, Chambal Fertilisers and Chemicals Limited, REC Limited, etc.
What are high EPS stocks?
High EPS stocks are the shares of those companies which report high earnings, profitability relative to their outstanding number of shares.
What is the formula to calculate the EPS?
The formula to calculate the EPS is Net Profit/Total Number of Outstanding Shares.
Is it advisable to invest in companies with high EPS?
Yes, one can invest in companies with high EPS as it reflects high profitability. However, investing based only on EPS is not a good idea; there are various other factors which also need to be considered before investing.
