Best Long Term Stocks to Buy in NSE India for 2024

Last Updated on Nov 18, 2024 by Aishika Banerjee

Long-term investment in fundamentally strong stocks is like a wealth-generating machine. On the one hand, you invest in a company with robust prospects and strong qualitative features and financials. On the other hand, you reap the benefits of compounding. Together, these work like magic and can potentially garner handsome returns in the long run. In this article, let’s take a look at the best stocks for long-term investment.

Best Stocks to Buy in India for the Long-Term

Name	Sub-Sector	Market Cap (Rs. in cr.)	Close Price (Rs.)	PE Ratio	5Y Avg Net Profit Margin (%)	5Y Hist Op. Cash Flow Growth (%)	Return on Equity (%)	Debt to Equity (%)
Adani Ports and Special Economic Zone Ltd	Ports	273,305.99	1,264.55	33.70	27.83	20.02	15.95	0.90
Kotak Mahindra Bank Ltd	Private Banks	339,739.57	1,707.90	18.65	19.32	53.80	15.03	0.00
Adani Total Gas Ltd	Gas Distribution	75,256.11	683.90	112.74	18.58	21.81	20.47	0.43
Hindustan Unilever Ltd	FMCG – Household Products	561,663.59	2,389.20	54.65	16.62	21.68	20.16	0.03
Bajaj Auto Limited	Two Wheelers	264,959.76	9,482.95	34.37	16.52	21.40	26.43	0.07
Bharat Electronics Ltd	Electronic Equipments	205,477.71	280.95	51.57	15.94	25.21	26.37	0.00
Zydus Lifesciences Ltd	Pharmaceuticals	96,388.20	957.40	24.97	15.80	20.29	18.47	0.04
HCL Technologies Ltd	IT Services & Consulting	503,056.64	1,858.95	32.04	14.85	20.13	23.49	0.08
Adani Power Ltd	Power Generation	211,897.41	549.10	10.17	14.26	20.36	56.77	0.79
ICICI Bank Ltd	Private Banks	887,271.79	1,256.95	20.05	14.15	26.44	18.02	0.00

Note: The data on this list of the 10 best shares to buy today for long term was taken on 14th November 2024. We have listed the 10 best stocks to buy in India for the long term based on the following parameters on the Tickertape Stock Screener.

• Stock Universe: Nifty 100
• 5Y Net Profit Margin: Sort from highest to lowest
• 5Y Historical Operating Cash Flow: Set to High
• Return on Equity: Set to High
• Debt-to-Equity: Set to Low

Please note that these stock selection criteria and the stocks are provided for informational purposes only; it is essential to conduct your own research.

🚀 Pro Tip: Utilise Tickertape’s Market Mood Index to gauge market sentiment and make informed investment decisions based on real-time market data and trends.

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Details of Top 10 Stocks for Long-Term Investment in India

Adani Ports and Special Economic Zone Ltd

Adani Ports and Special Economic Zone Ltd (APSEZ) is India’s largest private multi-port operator and an integral part of the Adani Group, a globally diversified conglomerate with interests spanning energy, resources, logistics, agribusiness, and other sectors. 

As of 14th November 2024, Adani Ports and Special Economic Zone Ltd has a market capitalisation of Rs. 273,305.99 cr. The current stock price is Rs. 1,264.55. The company’s PE ratio stands at 33.70. Over the past five years, IRCTC has maintained an average net profit margin of 27.83%. The company has demonstrated substantial growth in operating cash flow, with a five-year historical growth rate of 20.02%. Adani Ports and Special Economic Zone Ltd’s return on equity (ROE) is 15.95%. The company’s debt-to-equity ratio is 0.90%.

Kotak Mahindra Bank Ltd

Kotak Mahindra Bank Ltd is one of India’s leading private sector banks, known for its comprehensive range of financial services and commitment to customer-centric banking solutions. Established in 1985 as Kotak Mahindra Finance Ltd, a non-banking financial institution, it was granted a banking license by the Reserve Bank of India (RBI) in 2003, becoming the first. 

As of 14th November 2024, Kotak Mahindra Bank Ltd has a market capitalisation of Rs. 339,739.57 cr. The stock’s current price is Rs. 1,707.90, and it has a PE ratio of 18.65. Over the past five years, Kotak Mahindra Bank Ltd has achieved an average net profit margin of 19.32%. The company’s historical operating cash flow growth over the same period is 53.80%. Kotak Mahindra Bank Ltd’s return on equity is 15.03%. The debt-to-equity ratio is 0.00%.

Adani Total Gas Ltd

Adani Total Gas Ltd (ATGL) is a prominent player in India’s energy sector, specializing in the distribution of natural gas and developing sustainable energy infrastructure. Formed as a strategic joint venture between the Adani Group, one of India’s leading multinational conglomerates, and TotalEnergies, a global energy major headquartered in France, ATGL leverages the strengths of both entities to expand its reach and service capabilities across the country.

As of 14th November 2024, Adani Total Gas Ltd has a market capitalisation of Rs. 75,256.11 cr. The stock’s current price is Rs. 1683.90, and it has a PE ratio of 112.74. Over the past five years, Adani Total Gas Ltd has achieved an average net profit margin of 18.58%. The company’s historical operating cash flow growth over the same period is 21.81%. Adani Total Gas Ltd’s return on equity is 20.47%. The debt-to-equity ratio is 0.43%.

Hindustan Unilever Ltd

Hindustan Unilever Ltd (HUL) is a leading FMCG company in India, primarily dealing in household products. Established in 1933, HUL has a long-standing history of providing a wide range of consumer goods, including foods, beverages, cleaning agents, personal care products, and water purifiers.

As of 14th November 2024, HUL has a market capitalisation of Rs. 561,663.59 cr. The stock’s current price is Rs. 2,389.20, and it has a PE ratio of 54.65. Over the past five years, HUL has achieved an average net profit margin of 16.62%. The company’s historical operating cash flow growth over the same period is 21.68%. HUL’s return on equity is 20.16%. The debt-to-equity ratio is 0.03%.

Bajaj Auto Ltd

Bajaj Auto Ltd is a major player in the two-wheeler industry in India. Founded in 1945, the company manufactures motorcycles, scooters, and three-wheelers.

As of 14th November 2024, Bajaj Auto has a market capitalisation of Rs. 264,959.76 cr. The stock is priced at Rs. 9,482.95, with a PE Ratio of 34.37. The company has maintained an average net profit margin of 16.52% over the past five years. Its five-year historical operating cash flow growth stands at 21.40%. Bajaj Auto’s return on equity is 26.43%. The debt-to-equity ratio is 0.07%.

Bharat Electronics Ltd

Bharat Electronics Ltd (BEL) is a leading Indian state-owned aerospace and defense electronics company, operating under the Ministry of Defence, Government of India. Established in 1954, BEL has grown into a pivotal organization that designs, manufactures, and supplies a diverse range of high-technology electronic products and systems for the armed forces and other government sectors.

As of 14th November 2024, Bharat Electronics Ltd has a market capitalisation of Rs. 205,477.71 cr. The stock is priced at Rs. 280.95, with a PE ratio of 51.57. The company has maintained an average net profit margin of 15.94% over the past five years. Its five-year historical operating cash flow growth stands at 25.21%. Bharat Electronics Ltd’s return on equity is 26.37%. The debt-to-equity ratio is 0.00%.

Zydus Lifesciences Ltd

Zydus Lifesciences Ltd, formerly known as Cadila Healthcare, is a prominent pharmaceutical company in India. Established in 1952, Zydus Lifesciences focuses on manufacturing generic drugs, vaccines, biosimilars, and novel therapeutics.

As of 14th November 2024, Zydus Lifesciences has a market capitalisation of Rs. 96,388.20 cr. The stock’s current price is Rs. 957.40, and it has a PE Ratio of 24.97. Over the past five years, the company has achieved an average net profit margin of 15.80%. The historical operating cash flow growth over the same period is 20.29%. Zydus Lifesciences’ return on equity is 18.47%, and its debt-to-equity ratio is 0.04%.

HCL Technologies Ltd

HCL Technologies Ltd is one of India’s foremost IT services and consulting companies, with its headquarters in Noida, Uttar Pradesh. Established in 1976 as part of the HCL Group, HCL Technologies has emerged as a global leader in IT services, known for its extensive portfolio that includes IT and business services, engineering and R&D, and digital process operations.

As of 14th November 2024, HCL Technologies Ltd has a market capitalisation of Rs. 503,056.64 cr. The stock’s current price is Rs. 1,858.95, and it has a PE ratio of 32.04. Over the past five years, the company has achieved an average net profit margin of 14.85%. The historical operating cash flow growth over the same period is 20.13%. HCL Technologies Ltd’s return on equity is 23.49%, and its debt-to-equity ratio is 0.08%.

Adani Power Ltd

Adani Power Ltd is a major player in India’s power generation sector and part of the diversified Adani Group, which is known for its presence across infrastructure, energy, and logistics industries. Established in 1996, Adani Power has grown to become one of India’s largest private thermal power producers, contributing significantly to the nation’s energy requirements and economic development.

As of 14th November 2024, Adani Power Ltd has a market capitalisation of Rs. 211,897.41 cr. The stock’s current price is Rs. 549.10, and it has a PE ratio of 10.17. Over the past five years, the company has achieved an average net profit margin of 14.26%. The historical operating cash flow growth over the same period is 20.36%. Adani Power Ltd’s return on equity is 56.77%, and its debt-to-equity ratio is 0.79%.

ICICI Bank Ltd

ICICI Bank Ltd is one of India’s foremost private sector banks, known for its comprehensive range of financial services and strong presence across the country. Founded in 1994 and headquartered in Mumbai, Maharashtra, ICICI Bank has grown into a leading financial institution that serves millions of customers, encompassing individuals, small businesses, and large corporations.

As of 14th November 2024, ICICI Bank Ltd has a market capitalisation of Rs. 887,271.79 cr. The stock’s current price is Rs. 1,256.95, and it has a PE ratio of 20.05. Over the past five years, the company has achieved an average net profit margin of 14.15%. The historical operating cash flow growth over the same period is 26.44%. ICICI Bank Ltd’s return on equity is 18.02%, and its debt-to-equity ratio is 0.00%.

A Brief on the Filters Used to Discover the Top Stocks for Long-Term Investment

• Operating cash flow means the amount of cash generated by a company from its business operations (the revenue). It excludes costs associated with long-term capital investment. 5Y historical operating cash flow growth is expressed as the Compounded Annual Growth Rate (CAGR) of cash flow from operations over the last five financial years. The higher the number, the better it is.
• The net profit margin is expressed as the net profit or income as a percentage of revenue. It suggests how much of each rupee in revenue translates into profit. It helps understand whether a company is generating enough profit from its sales and also if its operating and overhead costs are under control. Therefore, it is an important indicator of a company’s financial health. 5-yr average net profit margin gets an average of the net profit margin in the last five financial years. The higher the number, the better it is.
• Return on equity (ROE) is a measure of a company’s profitability and how efficiently it is generated. ROE is derived by dividing a company’s net income by its shareholders’ equity. A higher ROE suggests that the company is efficiently converting its equity into profits. So the higher the ROE, the better it is.
• Although debt helps raise funds to run a company, it adds to a company’s liabilities. Too much debt can significantly impact earnings and, in the worst-case scenario, lead to bankruptcy or liquidation if it gets out of hand. Therefore, the debt to equity ratio becomes a critical metric for investors. This ratio compares a company’s total debt to its total equity, indicating the relative proportion of shareholders’ equity and debt used to finance assets. A higher ratio suggests potential over-reliance on debt, posing financial risks, while a lower ratio indicates a stronger equity position and generally implies greater financial stability. 

Apart from these, you can also use other parameters like EPS and market cap to understand the company better.

Why Invest in Stocks for the Long Term?

The answer is – to reap the benefits of compounded growth.

To understand this, you will have to know the power of compounding. Only then can you appreciate the role of ‘time’ in multiplying your returns over the long term.

Compounding works just like the multiplier effect. When you invest in an avenue, at first, your principal or initial investment earns interest. Later, the interest portion, along with the initial investment, also earns interest. That is how your investment multiplies!

Here’s a simple numerical example to help you understand the power of compounding. Mr A invests Rs. 1 lakh in a 5-yr deposit that earns simple interest of 10% p.a. At the end of 5 yrs, their investment grows to Rs. 1.5 lakh. But Mr Z invests Rs. 1 lakh in a 5-yr deposit that earns a compound interest of 10% p.a. At the end of the tenure, Mr Z’s investment will have grown to Rs. 1.61 lakh. It means they will earn Rs. 11,000 more than Mr A.

This is why you should consider top stocks to buy for the long term in India.

How to Choose Stocks for Long-Term Investment in India? 

If you want a short and sweet answer, then fundamental analysis it is. We have a detailed article on A Step-By-Step Guide to Fundamental Analysis. We highly encourage you to go through it – give your 14 minutes to read it and, in turn, better understand how to pick the best stocks for the long term.

For now, we will discuss it in brief.

The fundamental stock analysis means researching the underlying company’s fundamentals. Meaning business segments, products and services, historical financials, stock price trends, management, competitors, and so on.

Now, how do you evaluate quantitative factors such as financials? You can compare past financial statements and key financial ratios such as the PE ratio, net profit margin, debt level, and so on. Coming to competitors, you can do a peer analysis.

Put together, these findings reveal how the company has performed so far and signal its potential performance. That way, you will be in a better place to decide whether a company is worth investing in or not.

Fundamental analysis also means ascertaining whether a stock is fairly priced or not. We have yet another detailed article to help you understand why knowing the intrinsic value of a stock is important and how you can make sound investment decisions based on it. Read What Is the Intrinsic Value of a Stock and How To Calculate It?

How to Invest in Stocks for Long-Term Investment in India?

Investing in stocks for the long term may be a rewarding strategy, especially in a dynamic market like India. Long-term investments allow you to benefit from the power of compounding and ride out market volatility. Here are some key steps to guide you through the process:

1. Research and Identify the Best Long-Term Stocks

When considering long-term investment stocks, thorough research may be essential. You can look for companies with strong fundamentals, consistent earnings growth, and a competitive edge in their industry. Use Tickertape Stock Screener and asset pages to thoroughly understand a stock before investing.

2. Evaluate the Company’s Financial Health

Before investing, you should evaluate the company’s financial health by reviewing its revenue, profit margins, debt levels, and cash flow. Companies with strong financials are more likely to provide sustained returns over the long term. Tickertape provides detailed financial data for each stock along with a detailed Scorecard to help you assess the financial health of a company based on these essential metrics. Here’s an example.

3. Diversify Your Portfolio

Diversification may be a key strategy for minimising risk. Instead of putting all your money into one stock, you can spread your investments across various sectors and industries. This approach may help protect your portfolio from sector-specific downturns. You might want to include a mix of the best shares for the long term, such as technology, finance, and healthcare stocks. Tickertape’s Portfolio can help you create a well-diversified portfolio. Connect now and check if you have a well diversified portfolio!

4. Monitor Economic and Market Trends

Keeping an eye on broader economic and market trends may provide valuable insights into which stocks to buy for the long term. Factors like inflation, interest rates, and economic policies can impact stock performance. For this purpose, turn on Tickertape Alerts today!

5. Set Long-Term Goals and Stay Patient

Investing for the long term requires patience and a clear set of goals. Define your investment objectives, such as retirement savings or wealth accumulation, and stay committed to your strategy. Market fluctuations are normal, but maintaining a long-term perspective can help you stay focused on your goals.

Investing in long-term stocks in India may require careful planning and strategic decision-making. By focusing on strong companies with growth potential and maintaining a diversified portfolio, you can increase your chances of achieving sustained returns. Whether you’re looking for the best stocks to invest in 2024 or the best Indian stocks for the next 10 years, thorough research and a disciplined approach can help you navigate the market effectively.

Factors to Consider When Finding the Best Stocks to Buy Today in India for the Long-Term

Look for Companies That Innovate

When searching for the best stocks to buy today in India for the long-term, you might want to look for companies that innovate. Innovation may allow companies to develop better, future-proof products, potentially driving the company towards growth. A company that doesn’t innovate might lose ground compared to its more innovative competitors.

Identify Companies with Long-Term Relevance

You may want to identify companies whose products will remain relevant for a long time. Long-term investment in stocks can mean staying invested for over five years. Therefore, you would likely want to bet your money on a company that will still be operational and thriving in the years to come.

Ensure the Company Has Sound Management

Ensuring that the company’s management is sound and skilled is crucial. Since people run a company, the business’s growth can be significantly impacted if the leadership team is not capable. Additionally, ensure that the management is ethical and that the company has good corporate governance. Avoiding companies with poor governance, such as the infamous Satyam case, could be beneficial.

Be Cautious with Cyclical Businesses

It is essential to understand that not all businesses experience linear growth. Cyclical businesses, such as those in the cement, auto, and sugar industries, may incur losses at their cycle’s peak. Therefore, it could be wise to exercise caution when investing in such companies. For long-term investments, it often makes sense to consider safer companies that have demonstrated consistent linear growth over time.

Look for Transparent Disclosures

You might also want to find out whether the company is transparent when it comes to disclosures. Avoiding businesses that do not provide proper and adequate disclosures, especially about related party transactions, may be prudent. Transparency in disclosures can give you better insights into the company’s operations and financial health.

Advantages of Investing in the Best Stocks for Long Term Investment

Compounding Returns

Investing in the best stocks for the next five years may lead to significant compounding returns. As you reinvest profits, you can earn returns on your returns, potentially increasing your investment value exponentially over time. This compounding effect might help grow your investments substantially over the long term.

Dividend Income

Many of the best long-term stocks, including the top 10 stocks for long term, offer the advantage of dividend payments. This can provide you with a steady income stream in addition to any capital gains from the increase in stock price. Dividend income may be particularly beneficial during periods of market volatility, as it offers a consistent return regardless of short-term price fluctuations.

Reduced Volatility

Long-term investments in the best shares to buy today for the long term may weather short-term market volatility better than short-term investments. Over time, markets have historically trended upwards, which can smooth out the bumps of short-term fluctuations. By holding onto your investments for an extended period, you might experience less volatility and more stable returns.

Benefit from Economic Growth

Investing in the best shares to buy for the long term may allow you to benefit from economic growth. As economies expand, corporate earnings tend to increase, which can positively impact stock prices and investor returns. By choosing companies positioned to take advantage of economic growth, you might enhance your overall investment returns.

Opportunity for Significant Growth

Identifying the best long-term investment stocks may provide the potential for significant growth. Companies with strong fundamentals and growth prospects can see their stock values increase considerably over the years. By focusing on these companies, you might achieve substantial growth in your investment portfolio over the long term.

Disadvantages of Investing in Stocks for Long Term Investment

Capital Risk

Stock investments come with capital risk, as there’s always a possibility that the value of the best long term stocks can decline over time, especially if the selected companies do not perform as expected.

Liquidity Concerns

While stocks are generally considered liquid assets, investing with a long-term perspective may tie up capital that could be needed for unforeseen expenses. This is particularly true for investments in smaller, less liquid stocks.

Opportunity Cost

Investing in the best share for long term investment means locking in capital that could potentially earn higher returns elsewhere. This opportunity cost requires careful consideration, especially in rapidly changing markets.

Market Changes and Disruptions

Even good shares to buy for long term can be susceptible to market changes and technological disruptions. Industries that seem promising today may be overtaken by new technologies or shifts in consumer preferences over time.

Emotional Stress

Holding onto investments through market ups and downs can be emotionally challenging. Watching the value of what you believed was the best stock for long term investment fluctuate can test an investor’s patience and resilience.

Strategies for Long Term Investment 

Though long-term investment in stocks can benefit you in many ways, there are a few important rules you must consider before jumping right into it. 

Understanding the Risk

Risk is an unavoidable factor. Hence, it is highly important to analyse and balance your risks throughout your portfolio. When you build your portfolio for the long term, consider taking the help of a professional for risk analysis. 

Picking a Strategy That Fits Your Needs

Knowing your risk profile can help you decide on the kind of stocks you want to invest in. As a result, curate a strategy that helps you multiply your profits while keeping in check your risk-tolerance levels. However, also keep in mind that no investment strategy works all the time. Hence, keep the long-term goals in mind and include diversification in your portfolio.

Including Diversification in Your Stock Portfolio

A diversification strategy includes adding a variety of stocks/investment instruments to your portfolio that have different expected risks and returns. It may help you protect against events that might affect your portfolio and should still earn solid returns over the long term.

Time Horizon

One popular way of lowering your risk is by committing to your investments for longer. The longer the holding period is, the better your portfolio is able to sail through the ups and downs of the market. So, you can use time as a huge ally in your investing.

Who Can Invest in Long-Term Stocks?

Investing in long-term stocks is a strategy that can benefit a wide range of individuals. Here are five comprehensive points on who can invest in long-term stocks and why it might be suitable for them:

Young Professionals and Beginner Investors

Young professionals and beginner investors have a significant advantage when it comes to long-term investing. With time on their side, they can leverage the power of compounding to grow their wealth substantially. Starting early with investments in the best long term stocks to buy allows them to ride out market volatility and benefit from the market’s overall upward trend.

Middle-Aged Individuals and Parents Saving for Children’s Future

Middle-aged individuals focused on building a robust retirement fund, as well as parents saving for their children’s education or future needs, can benefit from long-term stocks. By diversifying their portfolio with shares to buy for long term, they can achieve a balance of growth and security, ensuring substantial funds are available when needed.

Retirees and Conservative Investors

Retirees and conservative investors often seek stable, income-generating investments. Companies with a history of stable earnings, strong financial health, and regular dividend payouts are ideal for this group. The best long term investment stocks in India, including the top 10 stocks to buy for long term, often include blue-chip companies that offer reliability and steady returns, providing growth potential and protection against inflation.

Aggressive Investors and Entrepreneurs

Aggressive investors and entrepreneurs looking for high returns can focus on growth stocks and emerging sectors. Investing in long term shares in rapidly growing industries allows them to potentially achieve significant gains, benefiting from the expansion and innovation within these sectors of the top long term stocks.

High-Net-Worth Individuals and Institutional Investors

High-net-worth individuals (HNWIs) and institutional investors such as pension funds, mutual funds, and insurance companies look for stable, high-performing stocks to ensure steady returns for their stakeholders. Including the best stocks to invest in 2024 and the top 50 shares for long term investment in their portfolio helps achieve a balanced mix of growth and security.

Conclusion

Investing in long-term stocks can benefit a wide range of investors, from young professionals to retirees. By focusing on strong, well-established companies and maintaining a diversified portfolio, you can achieve significant growth and stability. Whether you’re building a retirement fund or saving for your children’s future, a disciplined and patient approach to long-term investing can help you reach your financial goals.

FAQs About Best Long Term Stocks