It is known that stock market investing involves risks, often referred to as market volatility. While risks are unavoidable, a certain category of large-cap stocks help investors reduce risks to an extent. They are called blue chip companies and their shares are called blue chip stocks. In other words, blue chip stocks are high-quality stocks of well-established companies that exhibit consistent growth and financial stability.
Indian blue chip companies and their stocks are considered relatively safe and reliable, making them a popular choice for Indian traders and investors. In this blog, we will discuss some of the best Indian blue chip company stocks of 2024 that you can consider investing in.
What are blue chip stocks?
Before moving to discuss the list of top blue chip company stocks in India, let’s begin by understand what are blue chip stocks. By definition, blue chip stocks are well-established and financially stable companies or enterprises with a steady track record. Typically, blue chip companies or enterprises are the industry bellwethers or the driving forces of the industry. They have significant market presence, consistent profitability, and a proven record of giving healthy stock returns over the long term.
List of the top 10 blue chip stocks by Market Capitalization
Though there are many large-cap companies listed on the BSE and the NSE, there are only a handful of blue chip stocks that you can consider for investing. Here is a list of top 10 blue chip company stocks for 2024.
- Reliance Industries
- TCS
- HDFC Bank
- State Bank of India
- Infosys
- ITC
- Hindustan Unilever
- Coal India
- Tata Motors
- Larsen & Toubro Ltd.
Top 10 blue chip stocks to invest at a glance
Long-term investment in blue chip companies is considered safe, thanks to their ability to withstand market downturns smoothly and efficiently. However, performance is an important consideration when choosing the best blue chip stocks for investment. Below, we will discuss the performance of the top 10 blue chip stocks in India that you can consider investing in.
| Company | Market Cap (Rs. cr) | P/E Ratio | ROE (%) | Dividend Yield (%) |
| Reliance Industries | 20,17,971 | 29.3 | 9.23 | 0.30 |
| TCS | 15,64,063 | 32.9 | 51.5 | 1.28 |
| HDFC Bank | 12,29,701 | 18.0 | 17.1 | 1.22 |
| SBI | 7,57,075 | 11.3 | 17.37 | 1.62 |
| Infosys | 7,57,890 | 28.4 | 31.8 | 2.08 |
| ITC Ltd | 6,12,048 | 30.0 | 28.4 | 2.77 |
| HUL | 6,36,563 | 61.6 | 20.2 | 1.56 |
| Coal India | 3,03,237 | 8.10 | 53.4 | 4.88 |
| Tata Motors | 4,00,568 | 12.4 | 49.4 | 0.29 |
| L&T | 4,98,107 | 37.5 | 14.7 | 0.79 |
Overview of the best blue chip stocks
Blue chip companies play a leading role in the stock market, generating consistent returns for investors. Here is a brief overview of the best blue chip company stocks.
Reliance Industries
As an Indian oil-to-telecom conglomerate, Reliance has a presence in multiple industries and sectors in the country. Its stable oil refining and chemicals business and its growth bets in retail and digital space make Reliance a good choice for long-term investment.
Tata Consultancy Services (TCS)
Popularly known as TCS, the company provides information technology services, business solutions, and consulting. Considered an industry bellwether, the company has a sizable market share in the Indian IT outsourcing services segment.
HDFC Bank
One of the leading Indian banks, HDFC Bank has a presence across the country. The bank has a healthy loan portfolio and growing deposits that bode well for its long-term growth prospects. Additionally, experts believe that HDFC bank is currently undervalued and thus offers strong long-term capital appreciation opportunities.
State Bank of India
India’s largest bank with a nation-wide network is a byword for banking for millions of Indians. Despite competition from private-sector banks, the bank has maintained its market-leading position, making it a stable blue chip stock for investment.
Infosys
The Bangalore-based IT outsourcing firm is an investor favorite, renowned for its business expertise and high corporate governance standards. Infosys, which ranks among the top Indian IT firms, is also listed on the New York Stock Exchange.
ITC Ltd
Best known for its cigarette brands such as India Kings and Gold Flake, the company has interests in hotels, agri-business, packaged foods business, and personal care products. The stock is a good play on the country’s fast-growing FMCG sector.
Hindustan Unilever
Hindustan Unilever Limited (HUL), a leading consumer goods company, is known for popular brands such as Surf Excel and Dove. Many of its products are market leaders in the industry segments they operate, making it a safe bet for long-term investment.
HUL’s product portfolio comprises 50+ brands in 14+ FMCG categories. These brands play a significant role in serving millions of people across India.
Coal India
Coal India Ltd is one of the largest coal mining corporations in the world. It is owned by the Ministry of Coal, Government of India. Though the government has allowed 100% FDI in mining and sale of coal, Coal India still maintains its dominant position in the market, making it a good investment.
Tata Motors
The automobile company with cutting-edge technology and a growing presence in the Electric Vehicle (EV) space, Tata Motors is a stock for the future and will gain further momentum with the rising popularity of EVs in India.
Larsen & Toubro (L&T)
One of the largest infrastructure development companies in India, L&T has a very strong order book with orders from across the globe, including the Middle East. In addition to infrastructure, L&T is making a headway in the semiconductor space, making strategic acquisitions. This makes L&T a long-term investment stock.
Who should invest in the best blue chip stocks?
Blue chip stocks are appropriate for traders who want to build a diverse and stable portfolio. Long-term and cautious traders generally find blue chip company stocks appealing as they offer stability and regular returns over high-risk, high-return stocks. Blue chip companies have the ability to weather downturns in the market and pay dividends to investors.
Benefits of investing in the best blue chip stocks
Investing in blue-chip company stocks offers several benefits. Here are some of them.
Innovation and development
Most IT companies are directly associated with innovation and development. Not only that, they are also most likely to experience market breakthroughs. So, investing in these blue-chip companies can help you leverage the growth of innovation and development.
Resilience and stability
Well-established blue chip companies often exhibit resilience and stability in terms of financial health. So, investing in these stocks also protects against investment risks.
Global reach
Most blue chip companies have a global presence. And when you invest in their stocks, it widens your exposure and helps you generate profit from the global market.
Strong financial performance
Another important benefit of investing in blue chip stocks is their impressive financial performance. Blue chip companies have robust market capitalization and a proven record of financial stability even during downturns.
Dividend potential
Blue chip companies have higher PE ratios and potential returns on equity over other stocks. So, when you invest in them, you will have a higher potential for dividend earnings from the stocks.
Adaptability
Lastly, blue chip stocks are also beneficial in terms of market trend adaptability. They are quite effective for long-term investments.
Things to consider before investing in best blue chip stocks
Here are a few pointers to consider before investing in blue chip stocks.
- Evaluate the company’s financials.
- Analyze market trends and the industry landscape.
- Observe the company’s growth potential and capacity.
- Consider the diversification aspect.
- Keep yourself updated on macroeconomic variables.
- Do proper market research and analysis.
How do you invest in the best blue chip stocks?
A systematic strategy is required when you plan to invest in blue chip stocks. Start by listing the top blue chip companies and analyze their market performance and track record. You can go through the financial accounts, earnings releases, and industry trends. Lastly, focus on portfolio diversification and keep a long-term view in mind before investing in any blue chip company stocks.
Conclusion
Investing in blue chip companies would be a prudent decision that can safeguard your investment from potential market risks. This is because blue chip stocks are relatively stable and have good adaptability to market trends, including downtrends. In this blog, we have discussed few top blue chip stocks of 2024 that you can consider investing in.
