Utility Stocks in India

What are utility stocks?

Utility stocks, in the NSE classification used here, are companies providing essential services other than electricity - such as water supply and treatment, and waste management. Electricity companies have their own power sector.

Utilities typically work under long-term contracts with municipalities, state governments or industrial clients, so their revenue can be steady, but they depend on those clients paying on time.

What to check before investing in utility stocks

Contract visibility

The length and value of long-term contracts in hand.

Receivables

How quickly government and municipal clients pay.

Regulatory framework

Tariffs and service standards set by authorities affect returns.

Risks to know

Payment delays from public-sector clients, regulatory changes and the capital needed to build and maintain infrastructure are the main risks for utility companies.

How to invest in utility stocks

1. 1

   Open a demat and trading account

   A demat account holds your shares electronically; a trading account lets you buy and sell them. With GoPocket you can open both online in a few minutes with your PAN, Aadhaar and bank details.

2. 2

   Add money

   Transfer funds to your trading account by UPI or net banking.

3. 3

   Research the company

   Pick a company from the list above and open its page to see its share price chart, financial performance and shareholding before you decide. Compare it with other utility stocks on business quality, debt, growth and valuation.

4. 4

   Place your order

   Search for the stock in the GoPocket app or web platform, choose the quantity, and place a delivery order to hold the shares in your demat account. A limit order lets you set the most you are willing to pay.

5. 5

   Track and review

   Follow the company's quarterly results and news. Spreading your money across several companies and sectors reduces the damage if one investment goes wrong.

Terms used on this page

LTP

Last traded price - the price at which the stock last changed hands. The figure below it is the change from the previous day's close.

Market cap

Market capitalisation: share price multiplied by the number of shares issued. It measures a company's size in the market and is shown here in rupees crore (1 crore = 1,00,00,000).

Cap band

Whether a company is large, mid, small or micro cap, based on its market capitalisation. Larger companies tend to be less volatile.

Sector and industry

The NSE groups companies into broad sectors (such as Financial Services) and narrower industries within them (such as Banks), based on what they mainly do.

Trading graph

How the share price has moved during the latest trading session, from the 9:15 open to the 3:30 close. The dashed line is the previous day's closing price.