Best Infrastructure Stocks in India 2024

Infrastructure is one of the sectors which is constantly evolving in the market for a long time. This sector is usually backed by government entities for the development of the country and its resources. Investors prefer these stocks for stable and long-term returns over time. In this article, we will discuss the industry overview and the best infrastructure stocks in India that you can consider. So let’s get started!

List of Best Infrastructure Stocks in India 2024

Here is a list of the top infrastructure stocks in India, ranked by market capitalization

Note: These stock's ranking is based on market capitalization. Please conduct a detailed analysis before investing. Metrics are recorded as of August 14th, 2024, and may vary daily.

Overview of Best Infrastructure Stocks in India

Let's discuss the company overview of the top 10 infrastructure stocks in India to better understand their position in the infra sector

1) Larsen and Toubro

L&T was incorporated in the year 1946 and has risen to become one of India’s leading multinational conglomerates. The company has been in business for more than 7 decades in the Industrial and infrastructure growth sector of India.

This company has a presence all over the globe namely across Middle Eastern countries, Africa, ASEAN countries, and other global countries. The company is largely invested in infrastructure and energy sectors and by taking up projects which include Clean Energy and Green Infrastructure projects. The company is also striving to become Carbon Neutral by the year 2040 through various sustainable energy projects. The company has an order book of Rs. 4,75,809 crores as of March 31, 2024.

With its diverse global presence and strong order book, L&T deserves a place in the best infrastructure stocks list.

2) Rail Vikas Nigam Ltd

Incorporated in 2003, RVNL is a Public Sector Undertaking working under the Ministry of Railways. The company primarily operates in railway infrastructure projects and building resources for Special-purpose Vehicle projects for the government. 

The company is engaged in various infrastructure projects worldwide which include building new railway lines, gauge conversion, railway electrification, tunnels, and also metro infrastructures. RVNL currently operates in 30 Project implementation units at 24 locations across India. The company has also extended its operations in countries like Maldives involving in infrastructure projects. Presently the order book of RVNL is at Rs. 85,000 crores.

With a robust order book and vast experience in railway infrastructure and international projects, Rail Vikas Nigam Ltd deserves a spot among India's top 10 infrastructure stocks.

3) IRB Infrastructure Developers

This company was incorporated in the year 1998 and has grown significantly over the years, becoming one of India’s largest private developers in the highway infrastructure sector. The company’s financials are strengthened by its toll plaza revenues and other construction activities.

IRB Infra operates primarily in India having a significant presence across multiple states. The company is mainly involved in the development, construction, and maintenance of roads and highways in India. They currently operate more than 64 Toll Plazas across various states. Their major projects include the Mumbai - Pune expressway, Ahmedabad - Vadodara Expressway, and several other projects across the country. As of 31 March 2024, the company has secured an order book of Rs. 34,800 Crores. 

Given its robust portfolio and significant role in highway infrastructure, IRB deserves a spot in the top infrastructure stocks list.

4) NBCC India Limited

NBCC Limited which was formerly known as National Buildings Construction Corporation was incorporated in the year 1960 as a Public Sector Enterprise under the Government of India. The company primarily caters to civil engineering projects for various central and state government ministries. 

The company has a significant presence across many states in the country, developing a wide variety of projects which includes residential and commercial complexes, hospitals, educational institutions, and large infrastructure projects. NBCC also operates in countries like Maldives, Mauritius, and Dubai. Presently, the company has an order book of Rs. 64,000 Crores. 

With an order book of Rs 64,000 crores, NBCC is a strong contender among infra stocks to buy.

5) IRCON International Limited

This company was established in the year 1976 as an organization under the Ministry of Railways. IRCON International was formed to primarily focus on railway construction projects both domestically and internationally. Over the years the company has become a prominent name in the infrastructure sector because of its diversified product portfolio and expertise across various domains.

IRCON operates have a significant presence both domestically and globally. The company is involved in a wide range of projects including railways, bridges, tunnels, metro rail systems, and other projects. Globally the company has completed projects in more than 25 countries. Until FY 2023, the company has completed over 128 projects in foreign countries and more than 400 projects within India. As of 30th June 2024, the company has generated an order book of Rs. 26,034 Crores.

With a strong presence in 25+ countries and a solid order book, IRCON International is among the top infrastructure companies in India.

6) HFCL Limited

Incorporated in the year 1987, HFCL Ltd is a technology-driven enterprise that specializes in the manufacturing of telecom-related products and other integrated network solutions. Over the decades, the company has grown to be a leading provider of communication products and network solutions for the telecom, defence, and railway sectors.

The company is operating across multiple manufacturing facilities in India, including Hyderabad, Tamil Nadu, and Goa. HFCL has also positioned itself as a key player in the optical fibre cable industry. It has also secured an international presence by exporting to more than 45 countries with strategic subsidiaries established in the USA and Netherlands to facilitate their global operations. HFCL Ltd has secured an order book of Rs. 6,776 Crores by the first quarter of FY2025.

7) Techno Electric Engineering Company Limited

Techno Electric Engineering Company was incorporated in the year 2005, to specialize in the fields of power generation, transmission, and distribution in the power sector. The company is significantly known for its expertise in executing complex electrical engineering projects.

Techno Electric operates primarily in India but has a presence in the international markets as well. The company has executed many major projects in India which include the construction of substations and transmission lines. The company is focusing on renewable energy projects, particularly in the wind and solar power sectors. Techno Electric is planning to expand its opportunities in the overseas market mainly in Africa and Southeast Asia. As of 31st March 2024, the company maintained an order book of Rs. 92,189 Crores.

8) RITES Limited

This company formerly known as Rail India Technical and Economic Service, was established in the year 1974 as a Government of India enterprise under the Ministry of Railways. The company was established to provide consultancy services in rail transport management in India and abroad.

Rites have a global presence in more than 55 countries across Asia, Africa, America and the Middle East. The company caters to various sectors including railways, highways, airports, and more. The company is actively involved in government initiatives like the Smart Cities Mission and also in numerous metro rail projects. The company secured an order book of Rs. 5,690 Crores by the end of 31st March 2024.

9) Waaree Renewable Technologies Limited

This company was incorporated in the year 1999 as a subsidiary of Waree Energies Limited. Waaree Technologies has become a significant player in the renewable energy sector particularly focusing on the Solar energy sector. The company is also aiming to transition towards green hydrogen, improving the renewable energy infrastructure in India.

Headquartered in Mumbai, the company operates across various states within India. They have successfully commissioned projects across 13 states in the country. The company is contributing largely in the areas of floating and ground-mounted solar installations for renewable energy generation. The Company has an unexecuted order book of 2,191 MW and an executed order book of 217MW during the first quarter of FY25.

10) Engineers India Limited

EIL was incorporated in the year 1965 as PSE ( Public Sector Enterprise) under the Ministry of Petroleum and Natural Gas. The company has evolved into becoming a leading engineering consultancy company, particularly in the oil and gas sector.

EIL is keen on expanding its operations in India and globally. It has a significant international presence in the Middle East, Africa, America, and so on. EIL is involved in the development of smart cities, and high-speed railways, aligning towards sustainability and energy efficiency. The company is actively involved in the oil and gas sector, providing consultancy services and executing other infrastructure projects. As of June 2024, the company has secured an order book of Rs. 96,581 Crores.

What is Infrastructure Stocks?

The infrastructure stocks are the companies that are actively involved in the manufacturing, developing, servicing, and maintenance of essential structures like bridges, buildings, roads, highways, railways, ports, telecommunications, and network sectors.

Infrastructure Industry in India

The infrastructure sector in India is experiencing significant growth, primarily through an unprecedented rise in capital investment. The 2024-25 Interim Budget decided to allocate Rs 11.11 lakh crore (US$ 133.86 billion) for infrastructure purposes which is higher than the previous year by 11.1% and represents 3.4% of GDP (Gross Domestic Product). This input of money intends to enhance the country’s infrastructure, paying attention to promoting private investors’ involvement via the newly formed Infrastructure Finance Secretariat.

Moreover, Foreign Direct Investments (FDIs) have likewise been instrumental in the expansion of this sector. During the April 2000 and March 2024 period, construction and infrastructural activities attracted FDI worth US$ 33.91 billion across various development projects. The improvements within the logistics sector are similarly set to witness rapid growth in the coming years. Government initiatives are enhancing the efficiency and capacity of transport infrastructure as part of overall development processes aimed at modernizing the country’s infrastructural landscape. 

Factors to Consider Before Investing in Infra Stocks in India

Now that we've gone through the industry overview, let's check out the factors to consider before investing in infrastructure companies in India

Order book

Analyze the company’s order book to see the number of contracts and projects it has undertaken compared to its peers to understand the company’s overall performance.

Company Fundamentals

Evaluate and check the company’s earnings, debt, and revenue growth before investing in the infra stocks.

Government Policy and Budget

The Annual budget and government policies can have a significant impact on the industry. Changes in the policies can affect government contracts and spending.

Geopolitical Risks

Infrastructure companies with international operations are exposed to geopolitical risks, including political differences, changes in trade policies, and currency fluctuations.

Technological Advancements

As the infrastructure sector is rapidly evolving, the company that invests in technology must have good growth prospects.

How to Invest in the Infrastructure Stocks

Now that we’ve understood the factors to consider before investing in infra stocks in India, let’s look at the steps to invest in them:

• Research and find out the best-performing Infrastructure stocks in the market

• Evaluate and assess your risk appetite and fix your financial goals

• Shortlist the stocks based on your fundamental and technical analysis

• Open Demat account and trading account through a trusted stockbroker

• Invest in the shortlisted infra stocks and monitor them regularly

Conclusion

Investing in the best infrastructure stocks in India can offer stable and long-term growth potential, especially in a rapidly developing economy like India. With proper research and strategic investment, infrastructure stocks can be a valuable addition to any investment portfolio. 

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