Public Sector Undertaking (PSU) shares are issued by organizations that are owned and operated directly by the Indian government. These companies operate in key sectors like energy, defense, banking, and more, playing a vital role in the country’s economy.
PSU stocks are known for their stability and regular dividends, making them popular among investors.
In 2025, several PSU stocks are expected to gain attention due to strong fundamentals and government initiatives.
This article discusses what PSUs are, and which top-rated PSU stocks should be on your watch list for this year.
What are PSU Stocks?
PSU stocks represent Public Sector Undertakings, where the government owns more than 50% of the controlling stake. These entities focus on serving public needs across key sectors like energy, finance, transportation, and resources.
Over the years, PSUs have grown through budgetary support, operational improvements, and reinvested earnings, often catering to underserved areas.
Assessing their performance requires a balanced approach that considers both financial metrics and their contribution to socio-economic development, ensuring alignment with ethical value creation.
Top PSU Stocks to Buy in India 2025
To help you make informed investment decisions, we’ve listed some PSU stocks rated as “BUY” by analysts in the I/B/E/S database. These expert opinions highlight stocks considered among the best stocks to buy now.
However, it’s crucial to do your own research and choose stocks that match your risk level and investment goals. Here’s a quick look at some of these PSU stocks.
| Company Name | Approx. Share Price (₹) | Approx. Market Cap (₹ Crore) |
| State Bank of India (SBI) | 600 | 5,30,000 |
| Oil & Natural Gas Corp (ONGC) | 180 | 2,30,000 |
| NTPC Limited | 190 | 1,85,000 |
| Coal India Limited | 230 | 1,40,000 |
| Hindustan Aeronautics (HAL) | 1,550 | 51,000 |
1. State Bank of India (SBI)
In the second quarter of FY25, the State Bank of India (SBI), which stands as India’s largest public sector bank, reported a net profit of ₹18,331 crore, reflecting a 27.92% increase compared to the same period the previous year.
The growth was driven by a 5.37% rise in net interest income, reaching ₹41,620 crore. However, the net interest margin declined to 3.27% from 3.43% the previous year.
SBI’s gross advances grew by 14.9%, totaling ₹39.2 trillion, while deposits increased by 9.1%, amounting to ₹51.17 trillion. The gross non-performing asset ratio improved to 2.13% from 2.21% in the previous quarter.
These results underscore SBI’s strong financial performance and its significant role in India’s banking sector.
2. Oil & Natural Gas Corporation (ONGC)
Oil and Natural Gas Corporation (ONGC) is India’s leading crude oil and natural gas producer, contributing significantly to the country’s energy sector.
In the second quarter of fiscal year 2025 (Q2 FY25), ONGC reported a standalone net profit of ₹11,984 crore, marking a 17% increase from the same period last year. This growth was achieved despite a 3.6% decline in gross revenue, which stood at ₹33,881 crore for the quarter.
At the same time, the company’s crude oil realization decreased by 7.7% to $78.33 per barrel, reflecting global oil price trends.
On top of that, ONGC declared an interim dividend of ₹6 per share, underscoring its commitment to shareholder value. Its solid performance and key role in India’s energy sector make it one of the best PSU stocks to choose for 2025.
3. NTPC Limited
NTPC Limited is India’s largest energy company, primarily focused on power generation. It holds a massive installed capacity of 76,510 MW, ensuring a stable electricity supply. NTPC has strong financials, making it the third contender on our best PSU stocks list.
In terms of consolidated net profit, the company reported a 13.8% year-over-year increase for Q2 FY25, reaching ₹5,380 crore. However, revenue from operations experienced a slight decline of 0.6%, amounting to ₹44,696 crore.
The company’s coal stations achieved a Plant Load Factor of 76.31%, surpassing the national average of 70.63%. Additionally, NTPC’s total installed capacity reached 76,443 MW this quarter, showing growth from 73,824 MW in the corresponding period of the prior year.
4. Coal India Limited
Coal India Limited, established in 1975, is the world’s largest coal producer, significantly contributing to India’s energy needs. In Q2 FY25, the company reported a consolidated net profit of ₹6,275 crore, a 22% decline from ₹8,048.64 crore in the same quarter the previous year.
Revenue from operations also decreased by 6.4%, totaling ₹30,672.9 crore compared to ₹32,776 crore in Q2 FY24.
Despite these financial challenges, Coal India declared a first interim dividend of ₹15.75 per share for FY25, with a record date set for November 5, 2024.
The company continues to play a pivotal role in meeting India’s coal demand, operating over 300 mines across eight states.
5. Hindustan Aeronautics Limited (HAL)
Hindustan Aeronautics Limited (HAL) is India’s leading aerospace and defense company, focusing on designing, developing, and making aircraft, helicopters, and related systems. In the second quarter of fiscal year 2025, HAL reported a net profit of ₹1,510 crore, which is a 22% increase compared to ₹1,237 crore in the same quarter last year.
The company’s revenue from operations grew by 6%, reaching ₹5,976 crore, up from ₹5,636 crore in the previous year. This growth is mainly due to strong demand from India’s defense sector and key contracts, such as a ₹26,000 crore deal to supply 240 aero-engines for the Indian Air Force’s Su-30MKI aircraft.
HAL’s strong financial performance highlights its key role in India’s defense sector, making it a top choice for investors looking for growth in PSU stocks.
Conclusion
Investing in Public Sector Undertaking (PSU) stocks offers stability and consistent dividends due to government backing.
However, potential investors should be aware of risks such as bureaucratic inefficiencies and political interference, which can impact performance. It’s crucial to conduct thorough research and consider these factors before including PSU stocks in your investment portfolio.
