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Top Monopoly Stocks in India 2022

Asefa Hafeez
monopoly-stocks

A monopoly stocks is a business that operates in a market with little to no competition and is able to control the conditions and prices it charges customers, allowing it to be very successful. There are various ways for a corporation to dominate its industry or area, despite the fact that monopolies are typically prohibited under law and disliked. The use of intellectual property rights, the acquisition of rival businesses, or the hoarding of a limited supply are a few examples of techniques to monopolise the market.

 

The government’s giving a firm the sole authority to sell goods or offer services is the simplest way for a company to turn into a monopoly. Monopolies established by the government are meant to produce economies of scale that benefit customers by lowering costs. Now, purchasing monopoly stocks has many advantages. These businesses have been around for a while and have a track record of making money even during challenging economic times. Additionally, most monopoly stocks pay dividends to their owners.

 

 

How Does A Business Establish A Monopoly?

 

First off, monopoly stocks have control over pricing. Why does this matter? It simply means that you will continue to buy their products even if the monopoly stocks company decides to raise the prices of its goods or services. Consider purchasing a private jet as an illustration. Owning a private jet is a sign of status. You’ll buy a private jet even if the price goes up.

 

Now, the issue is: What drove you to purchase the item despite its high cost? Simply said, it’s the result of a high switching cost.

 

What Is Switching Cost ?

 

When a consumer switches from one product to another, a fee is incurred. Offering distinctive qualities in their products, businesses with strong pricing power and a wide moat make it difficult for their customers to use a competitor’s product. Due to their competitive edge, monopoly stocks like these have a promising future.

 

The reputation of the company is what distinguishes monopoly stocks from other stocks.

 

I’d like to ask you a question. What toothpaste brand is the first to spring to mind when you think about noodles? Isn’t that Maggi? Companies with monopolies enjoy exceptional brand recognition. That’s because they spent a lot of time giving their product a distinctive feature. Not only that, the business has also made significant investments in distribution network expansion and marketing. These factors make monopoly stocks susceptible to becoming multi-baggers in the future.

 

We have mentioned 10 monopoly stocks that are listed on the stock exchange and have the potential to give high returns. It is important to note that all investments in the stock market are subject to market risk and returns are not guaranteed. This list is not investment advise, just a collection of companies which have a monopoly or near market monopoly in their market segment. 

 

Best Monopoly Stocks in India:

 

Monopoly stocks In India Market Share % in Segment Current Share Price Market Capitalization

( In Cr)
IRCTC 100% in ticketing business Rs 715.15 ₹57,124.0 Cr
HAL 100% in defence manufacturing Rs 2,601.25 ₹87,062.8 Cr
IEX 95% of short-term electricity contracts in India Rs 162.65 ₹14,625.8 Cr
MCX 92% in India’s commodities exchange sector Rs 1,267.25 ₹6,462.8 Cr
Coal India 82% in coal production Rs 233.25 ₹1.4 Lac Cr
Hindustan Zinc 78% in zinc industry Rs 285.85 ₹1.2 Lac Cr
ITC 77% in cigarettes Rs 336.20 ₹4.2 Lac Cr
Marico 73% in oil products Rs 529.75 ₹68,414.3 Cr
CAMS 70% within the mutual fund industry Rs 2,593.85 ₹12,686.5
Pidilite Industries 70% share in adhesives Rs 2,861.45 ₹1.5 Lac Cr

 

 

IRCTC is a “Mini Ratna (Category-I)” Central Public Sector Enterprise that falls under the Ministry of Railways of the Government of India. The Indian Railway Catering and Tourism Corporation (IRCTC) was established on September 27, 1999, as an extension of the Indian Railways. Its mission is to promote domestic and international tourism through the creation of low-cost accommodations, unique tour packages, informational and promotional campaigns, and international reservation systems. It is registered and its corporate headquarters are in New Delhi.

 

The following is a list of the company’s primary activities:

 

Currently, the company operates through: fourteen rail neer plants in Nangloi-Delhi, Danapur-Bihar, Palur-Tamil Nadu, Ambernath-Maharashtra, and Amethi (Uttar Pradesh), Parassala-Tamil Nadu, Bilaspur-Chhatisgarh, Hapur-Uttar Pradesh, Sanand- Gujarat, Mandideep-Madhya Pradesh.

 

New Delhi, Mumbai, Kolkata, Chennai, and Secundrabad each have a Zonal Office. One internet ticketing office in New Delhi, along with ten regional offices in Lucknow, Chandigarh, Jaipur, Bhopal, Ahmadabad, Guwahati, Bhubaneswar, Patna, and Ernakulam. New Delhi has one tourism office.

 

 

With its headquarters in Bengaluru, India, Hindustan Aeronautics Limited (HAL) is a state-owned aerospace and defence business in India. It has its headquarters in Bengaluru, India. HAL is one of the oldest and biggest aerospace and defence businesses in the world today. It was founded on December 23, 1940. HAL now has 4 production units distributed across India, 11 dedicated research and development (R&D) centres, and 21 manufacturing divisions. The Ministry of Defence, Government of India, on behalf of the President of India, appoints the members of the Board of Directors at HAL. HAL’s current projects include refurbishing and modernising Indian military aircraft, designing and producing fighter planes, helicopters, jet engines, and marine gas turbine engines, as well as developing software, avionics, and providing spare parts. 

 

On December 23, 1940, Walchand Hirachand founded Hindustan Aircraft Limited in Bangalore in collaboration with the then-Kingdom of Mysore. Walchand Hirachand was appointed the Chairman. The company’s office was established in a home on Domlur Road called “Eventide.” William D. Pawley of the Intercontinental Aircraft Corporation in New York organised and outfitted the facility in Bangalore. Pawley imported a significant amount of machinery and equipment from the US.

 

As it saw this as a strategic necessity, the Indian Government invested 25 lakh to purchase a third of the company in April 1941. The government made the choice primarily to increase British military hardware supplies in Asia to combat the growing threat that Imperial Japan faced during the Second World War. 

 

The Bangalore facility was transferred to the United States Army Air Forces in 1943, but Hindustan Aircraft management remained in place. The 84th Air Depot was the name of the rapidly growing facility, which underwent extensive American aircraft refurbishment and repair. The government of India took over the company’s management when India attained independence in 1947.

 

 

The foremost energy market in India is called Indian Energy Exchange. It offers a national automated trading platform for the actual supply of power, renewable energy, and certifications. In an effort to develop a fully integrated South Asian power market, IEX has more recently led the way in cross-border electricity exchange. Modern, user-friendly, and customer-focused technology powers IEX, enabling effective price discovery and enhancing the simplicity of power purchase.

 

The IEX ecosystem is strong, with 6,800+ participants spread over 29 states and 5 Union Territories, including 500+ conventional generators and more than 55 distribution utilities. Additionally, it has a sizable base of 4400+ commercial and industrial clients, including those from the metal, food processing, textile, cement, ceramic, chemical, automotive, information technology, institutional, housing, and real estate sectors, as well as business organisations.

 

The exchange has been in operation since June 27, 2008, and the Central Electricity Regulatory Commission has licensed and controlled it. The Exchange has had ISO certifications for quality management, information security management, and environmental management since August 2016. Since October 2017, The Exchange has been a publicly traded business on the NSE and BSE.

 

 

The Multi Commodity Exchange of India Limited (MCX), the first publicly traded exchange in India, is a cutting-edge commodity derivatives exchange that enables online trading of commodity derivatives transactions, hence offering a platform for price discovery and risk management. The Securities and Exchange Board of India’s regulatory framework governs the exchange, which began operations in November 2003. (SEBI).

 

In addition to trading on indices made up of these contracts, MCX also provides trading in commodity derivative contracts across a variety of industries, including bullion, industrial metals, energy, and agricultural commodities. The first exchange in India to offer basic metals index futures, bullion index futures, and commodity options contracts. The Exchange develops quality standards and trade regulations in accordance with the regulatory framework with the goal of offering commodity value chain players neutral, secure, and transparent trade processes. With 588 registered members and 51,246 Authorised Persons, the Exchange it has a wide national reach. As of 30 June 2022, it was present in over 872 cities and towns throughout India. With a market share of around 96.4% in terms of the value of commodity futures contracts traded in the fiscal year 2022–2023 (April 2022–June 2022), it is the largest commodity derivatives exchange in India.

 

The main index series for the exchange, MCX iCOMDEX, is a collection of real-time commodity futures price indices that provide data on market movements in significant commodities and market segments traded on MCX. The MCX iCOMDEX series consists of nine single-commodity indexes: Gold, Silver, Aluminium, Copper, Lead, Nickel, Zinc, Crude Oil, and Natural Gas indices, in addition to a Composite index and three sectoral indices: the Base Metal index, the Bullion index, and the Energy index.

 

The first clearing organisation in the Indian market for commodities derivatives is Multi Commodity Exchange Clearing Corporation Limited (MCXCCL), a fully owned subsidiary of MCX. The clearing corporation handles the clearing and settlement of trades made on the exchange as well as the management of collateral and risk. In accordance with European market infrastructure regulations, MCXCCL has been recognised as a third country CCP by the European Securities and Markets Authority (ESMA). All deals carried out on the MCX trading platform are centrally counteracted by MCXCCL, which has a cutting-edge risk management system. Through a web-based portal called “Commodity Receipts Information Systems,” it also offers an Electronic Commodity Accounting and Receipts Tracking System (COMRIS). Additionally, it uses its Settlement Guarantee Fund to give settlement guarantees for all trades made on MCX.

 

 

In November 1975, the government-owned coal mining company, Coal India Limited (CIL), was established. In spite of its modest initial production of 79 Million Tonnes (MTs), CIL is now the world’s largest coal producer and one of the major corporate employers. Through its subsidiaries, CIL operates in 84 mining locations scattered across eight (8) Indian states. As of April 1, 2020, Coal India Limited operated 352 mines, of which 158 were underground, 174 were opencast, and 20 were mixed mines. Additionally, CIL administers additional facilities including workshops, clinics, and so forth in addition to operating 12 coal washeries (10 for coking coal and 2 for non-coking coal). There are 84 vocational training centres and 26 training institutes under CIL. The largest corporate training institute in India and a state-of-the-art management training “Centre of Excellence,” the Indian Institute of Coal Management (IICM) runs under CIL and offers multi-disciplinary programmes.

 

CIL is a Maharatna firm, a privileged status granted by the Indian government to a select group of state-owned businesses in order to enable them to grow and become global behemoths. Out of the nation’s more than 300 Central Public Sector Enterprises, only ten are a part of the privileged club.

 

 

The second-largest zinc-lead miner in the world is Hindustan Zinc. With more than 50 years of operational expertise, it places the utmost importance on protecting our citizens’ safety and conserving the earth’s finite natural resources. The life of mines owned by Hindustan Zinc is over 25 years with a reserve base of 150.3 million. In India’s main zinc business, its fully integrated zinc activities currently possess a 78 percent market share. With an 800 MT annual capacity, we are the sixth-largest silver producers in the world.

 

It is a division of Vedanta Limited, which owns a 64.9 percent ownership interest in the business, with the remaining 29.5 percent owned by the Indian government. It is listed on both the BSE and NSE.

 

 

A diverse company with operations in fast-moving consumer goods, hotels, paperboards and packaging, agribusiness, and information technology, ITC Limited is one of the top private sector enterprises in India. With gross sales of 90,104 crores and a net profit of 15,058 crores, the company is regarded as one of India’s most valuable corporate enterprises (as on 31.03.2022). A survey by Fortune India in collaboration with Hay Group selected ITC as the most admired corporation in India.

 

ITC is the leading FMCG marketer in the nation, the undisputed market leader in the Indian paperboard and packaging sector, a worldwide recognised pioneer in farmer empowerment with its extensive Agri Business, and a prominent hotel chain in India that pioneers “Responsible Luxury.” ITC Infotech, a wholly owned subsidiary of ITC, is a specialist global provider of digital solutions.

 

 

One of the top manufacturers of consumer goods in India is Marico, which specialises in beauty and health items. Marico ltd, sold its products in India and a few other Asian and African markets, generating a turnover of roughly INR 95 billion (USD 1.3 billion) during FY 2021–22. Through its portfolio of brands, including Parachute, Saffola, Saffola FITTIFY Gourmet, Saffola ImmuniVeda, Saffola Mealmaker, Hair & Care, Parachute Advansed, Nihar Naturals, Mediker, Coco Soul, Revive, Set Wet, Livon and Beardo, and Just Herbs, Marico affects the lives of one in three Indians. The worldwide consumer products portfolio, which includes brands including Parachute, Parachute Advansed, HairCode, Fiancée, Caivil, Hercules, Black Chic, Code 10, Ingwe, X-Men, Mediker SafeLife, Thuan Phat, and Isoplus, accounts for around 23% of the group’s revenue. With its headquarters in Mumbai, it has operations in more than 25 developing nations in Asia and Africa. With facilities in Puducherry, Perundurai, Jalgaon, Guwahati, Baddi, and Sanand, it runs seven factories in India.

 

 

For more than 20 years, CAMS has provided technology-driven financial infrastructure and services to mutual funds and other financial organisations. As of June 2022, CAMS served 69 percent of the average assets under management and was the industry’s largest Registrar and Transfer Agency. We also offer technology-enabled service solutions to insurance companies and alternative investment funds. In addition to acting as a B2B service partner, CAMS also provides customer care through a range of channels, including an extensive network of service centres across India, white-label contact centres, the internet, mobile apps, and chatbots.

 

 

PidiliteIndustries is a customer-focused business that is dedicated to quality and innovation. It has been developing ground-breaking products for decades for small to large applications in industry and at home, creating enduring relationships with individuals from all walks of life.

 

Its product offering is wide as it is ever-evolving, ranging from adhesives, sealants, waterproofing solutions, and building chemicals to arts and crafts, industrial resins, polymers, and more. Today, it is the global leader in adhesives and its brands are well-known in both the domestic and industrial sectors.

 

Its products are available to people from all demographics and locations thanks to a strong and expanding network.

 

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