Investing in infrastructure stocks can be a lucrative strategy, particularly in a rapidly developing economy like India. With the government's continuous push for infrastructure development, these stocks have the potential to deliver strong returns.
In this article, we are going to examine the best infrastructure stocks in India based on their importance in the country’s broader economy and stock market performance.
List of the top infrastructure stocks to buy in India:
Reliance Industries – The largest infrastructure company in India
Larsen & Toubro – The top infra construction company
NTPC – India’s largest energy corporation
Oil & Natural Gas Corporation – The largest oil and gas producer
Power Grid Corporation of India – The company managing India’s power grid
Adani Green Energy – Green energy company that’s shown remarkable growth
The 6 best infrastructure stocks to invest in India
In the sections that follow, we will provide a brief overview of the companies that make up the backbone of India’s infrastructure development. Note that the companies and stocks listed are ranked by their respective market capitalization.
1. Reliance Industries – The largest infrastructure company in India
Reliance Industries Limited (RIL) is a conglomerate with a diverse presence in petrochemicals, refining, oil and gas exploration, retail, and telecommunications. The company's extensive infrastructure network includes the world's largest refining complex in Jamnagar, robust retail operations, and Jio's vast telecommunications infrastructure. Reliance's integrated approach and commitment to innovation make it a cornerstone of India's infrastructure growth.
The company’s diversified portfolio across petrochemicals, refining, retail, and telecommunications ensures multiple revenue streams and resilience against market volatility. Its continuous innovation, strong leadership, and expansive infrastructure make it a robust investment, poised to benefit from India's ongoing economic growth and infrastructure development. At the moment, Reliant is by far the largest publicly traded company in India, with a market cap of 19.4 trillion INR ($232.9 billion USD at current rates).
Sector Energy Market Cap 19.4 trillion INR ($232.9 billion USD) 5-Year Performance +132.1%
2. Larsen & Toubro – The top infra construction company
Larsen & Toubro (L&T) is a leading engineering and construction firm in India. It plays a pivotal role in infrastructure projects across various sectors, including construction, power, heavy engineering, electrical automation, and information technology. L&T's expertise in executing large-scale projects, coupled with its strong project management capabilities, positions it as a key player in India's infrastructure landscape.
Larsen & Toubro's expertise in engineering and construction, combined with its strong project management capabilities, positions it well to capitalize on India's infrastructure boom. Its involvement in numerous high-profile projects, such as the 760MWh off-grid energy storage project in Saudi Arabia, and diversified business segments provide stability and growth opportunities, making it a solid pick for investors.
Sector Industrial Services Market Cap 4.8 trillion INR ($57.6 billion USD) 5-Year Performance +133.5%
3. NTPC – India’s largest energy corporation
NTPC Limited, formerly known as National Thermal Power Corporation, is India's largest energy conglomerate. It focuses on generating electricity through coal, gas, hydro, and renewable energy sources. NTPC's commitment to increasing its renewable energy capacity aligns with India's sustainable development goals, making it a vital component of the country's energy infrastructure.
Its dominant position in India's energy sector, coupled with its expanding renewable energy portfolio, aligns with the global shift towards sustainable energy. As India continues to grow its energy infrastructure, NTPC is set to play a critical role, offering long-term growth potential and stable returns to investors.
Sector Utilities Market Cap 3.5 trillion INR ($42 billion USD) 5-Year Performance +184.8%
4. Oil & Natural Gas Corporation – The largest oil and gas producer
Oil & Natural Gas Corporation (ONGC) is India's largest oil and gas exploration and production company. It plays a crucial role in meeting the country's energy needs by exploring and extracting hydrocarbons. ONGC's extensive offshore and onshore assets contribute significantly to India's energy security, making it a cornerstone of the nation's energy infrastructure.
The company’s extensive exploration and production capabilities make it a cornerstone of India's energy infrastructure. Its significant offshore and onshore assets ensure a steady supply of hydrocarbons, vital for the country's energy security. ONGC's strategic importance and potential for growth make it an attractive investment option.
Sector Energy Market Cap 3.5 trillion INR ($42 billion USD) 5-Year Performance +56.9%
5. Power Grid Corporation of India – The company managing India’s power grid
Power Grid Corporation of India is the central transmission utility of India. It is responsible for transmitting electricity across the country, operating and maintaining a vast network of high-voltage transmission lines and substations. Power Grid's efforts to strengthen the national grid and integrate renewable energy sources are essential for ensuring reliable power supply and supporting India's growing energy demands.
Power Grid's central role in transmitting electricity across India, along with its efforts to integrate renewable energy sources, positions it as a key player in the nation's energy landscape. The company's robust infrastructure and commitment to strengthening the national grid make it a reliable investment with strong growth prospects.
Sector Utilities Market Cap 2.9 trillion INR 5-Year Performance +211.2%
6. Adani Green Energy – A green energy company that’s shown remarkable growth
Adani Green Energy Limited (AGEL) is a leading renewable energy company in India. It focuses on developing, owning, and operating solar and wind energy projects. With a significant portfolio of operational and under-construction renewable energy assets, AGEL is at the forefront of India's transition to clean energy. Its aggressive expansion plans and commitment to sustainability make it a standout player in the renewable infrastructure space.
The company’s s focus on renewable energy aligns with global trends towards sustainability. With a significant portfolio of solar and wind energy projects and aggressive expansion plans, AGEL is well-positioned to benefit from the increasing demand for clean energy. Its commitment to sustainability and growth makes it an excellent choice for investors looking to tap into the renewable energy sector.
Sector Utilities Market Cap 2.9 trillion INR ($34.8 billion USD) 5-Year Performance +4,116%
The bottom line
India is currently on a massive upward trajectory. Its gross domestic product is expected to increase to $6.4 trillion by 2029, more than double of what it was in 2021. The unprecedented growth will only be possible with massive infrastructure projects in energy, transport, and utilities. The companies listed in this article are all poised to benefit from the positive economic growth trend over the coming years.
If you want to explore a more general overview of the best stock investments with a focus on Western companies, check out our list of the best stocks to buy right now.