Monopoly stocks refer to shares of companies that hold a dominant position within their respective industries, often exhibiting substantial market power and influence.
These companies enjoy a competitive advantage and often have the highest market capitalization, owing to their consistent delivery of high-quality goods and services.
Let’s explore 11 best monopoly stocks in India that exhibit a dominant market position and significant influence in their respective industries.
Monopoly Stocks List
| Monopoly stock | Percentage of market share in a segment |
| Indian Railway Catering and Tourism Corporation Ltd (IRCTC) | 100% in the ticketing business |
| Hindustan Aeronautics Ltd (HEL) | 100% in defence manufacturing |
| Nestle | 96.5% share in the cerelac industry |
| Indian Energy Exchange Ltd (IEX) | 95% of short-term electricity contracts in India |
| Coal India Ltd | 82% in coal production |
| Hindustan Zinc Ltd | 78% in the zinc industry |
| ITC Ltd | 77% in cigarettes |
| Marico Ltd | 73% in oil products |
| Pidilite Industries Ltd | 70% share in adhesive |
| Container Corporation of India Limited (CONCOR) | 68.52% in cargo carrier |
| Bharat Heavy Electricals Limited (BHEL) | 67% in the power equipment sector |
11 Best Monopoly Stocks in India
#1. Indian Railway Catering and Tourism Corporation (IRCTC)
Established in 1845, the Indian Railway Catering and Tourism Corporation (IRCTC) is a state-owned organization and monopoly in the online ticket booking market.
With approximately 60 million registered users and an average of 11.44 lakh tickets booked daily, IRCTC reigns supreme in the railway ticketing sector. In addition to ticketing services, IRCTC also provides catering and tourism services for the Indian Railways.
As a large-cap company in the Indian public sector, IRCTC offers stability and boasts a long-established presence in the market.
IRCTC is considered a natural monopoly because it possesses exclusive control over the railway ticketing market in India, owing to its extensive infrastructure and the practical limitations of multiple providers operating on the same rail network.
You can check out the IRCTC share price target 2023 to 2025 and the factors that may affect its stock price in the coming years.
#2. (HAL) Hindustan Aeronautics India Limited
Hindustan Aeronautics India Limited (HAL) enjoys a significant monopoly in the defense manufacturing sector in India. Its dominance can be attributed to various factors, including its extensive infrastructure, technical capabilities, and exclusive partnerships with international defense technology providers.
The monopoly status of HAL enables it to cater to the growing defense requirements of the Indian armed forces, contributing to the nation’s self-sufficiency in the defense sector.
Established in 1940 by Walchand Hirachand and the Government of Mysore, HAL comes with the aim of manufacturing aircraft in India.
HAL operates across multiple divisions, including Aircraft Manufacturing, Helicopter Manufacturing, Engine Manufacturing, and Research & Development.
#3. Nestle – Cerelac Industry
Nestle, a household name in India’s FMCG (Fast-Moving Consumer Goods) sector. Nestle holds a remarkable 96.5% share in the cerelac industry.
Cerelac, the renowned brand of instant cereal designed for infants aged 6 months and older, serving as a nutritious supplement to breast milk.
Founded in Switzerland in 1866, Nestle has emerged as a global leader in nutrition, health, and wellness. With a strong emphasis on providing high-quality products, Nestle has garnered immense trust among consumers globally.
The monopoly position of Nestle in the cerelac industry adds allure to its investment potential. With its extensive distribution network, brand recognition, and quality products, Nestle stands at an advantageous position in the market.
#4. IEX (Indian Energy Exchange)
In the realm of energy trading, the Indian Energy Exchange (IEX) takes center stage as a monopoly stock. As the leading platform for electricity trading in India, IEX holds an impressive 95% share in short-term electricity contracts.
It serves as a crucial hub where buyers and sellers can engage in efficient and transparent electricity transactions, contributing to the growth and stability of the Indian power sector.
Investing in IEX provides an opportunity to tap into the energy sector’s potential and capitalize on the company’s dominant market position.
As the sole player in short-term electricity contracts, IEX enjoys significant pricing power and benefits from the increasing demand for electricity trading in India. However, you should remain cautious of regulatory changes and potential shifts in the energy landscape.
To invest in IEX, you can explore the technical and fundamental analysis for IEX stock price target 2023 to 2025.
#5. Coal India
Coal India holds an impressive 82% share in India’s coal production, making it a monopoly stock in the country. As the world’s largest coal-producing company, Coal India plays a vital role in meeting India’s energy needs.
This company is owned by the Union government of India and is managed by the Ministry of Coal.
However, recent developments indicate a potential shift in the coal sector. The government’s announcement to open up commercial mining signifies a potential end to Coal India’s monopoly in the future.
#6. Hindustan Zinc
Within the metals and mining sector, Hindustan Zinc is a monopoly stock that holds 78% share in the zinc industry. Hindustan Zinc is one of the world’s second largest integrated producers of zinc, lead, and 5th largest producers of silver.
Hindustan Zinc is a part of the Vedanta Group, with the company holding a 64.9% stake, while the Government of India retains a 29.5% minority stake. This ownership structure further strengthens Hindustan Zinc’s position as a leading player in the industry.
#7. ITC – Cigarettes
ITC, a prominent name in the Indian market, commands a significant 77% share in the cigarettes segment. Known for its diversified presence across various industries, including cigarettes, FMCG, hospitality, and agribusiness, ITC has established itself as a key player in the Indian consumer goods sector.
Investing in ITC provides exposure to a diversified conglomerate with a monopoly position in the cigarettes segment. The company’s extensive distribution network, strong brand portfolio, and market dominance contribute to its appeal as an investment option.
You can read our list of most expensive shares in India to know why monopoly stocks are so expensive.
#8. Marico – Oil Products
Marico is a leading Indian consumer goods company that enjoys a monopoly in the oil products category. With a diverse portfolio encompassing hair care, skincare, and edible oils, Marico has cemented its position as a trusted brand in the Indian market.
Marico, a FMCG company in India, has achieved significant success primarily in two brands – ‘Saffola’ and ‘Parachute’.
Saffola, positioned in the premium refined edible oil segment, has firmly established itself as a market leader, capturing an impressive 73% share. Its continued dominance in this sector speaks to the brand’s quality and consumer trust.
On the other hand, Parachute, known for its hair care products, holds a substantial market share of 59%. These two brands contribute up to 90% of Marico’s overall income, underscoring their significance to the company’s financial success.
#9. Pidilite – Adhesive
With a dominant market share of 70% in the adhesive and industrial chemical market, Pidilite enjoys a commanding presence in its respective sector.
Pidilite offers a diverse range of products including adhesives and sealants (Fevicol and M-seal), construction and paint chemicals (Dr. Fixit), automotive chemicals, industrial adhesives, and industrial & textile resins.
The company’s strong market presence and dominant market share reflect its commitment to delivering high-quality products that cater to diverse industrial and consumer needs.
Pidilite’s success can be attributed to its focus on innovation, product quality, and understanding customer requirements, making it a trusted name in the adhesive and industrial chemical market.
If you want to enhance your stock investment knowledge further, you can also check out our list of the best personal finance youtube channels in India.
#10. Container Corporation of India Limited (CONCOR)
Container Corporation of India Limited (CONCOR) holds a formidable monopoly position in the cargo carrier segment, commanding a significant 68.52% market share. CONCOR is a Public Sector Undertaking under the management of the Indian Ministry of Railways.
Established in 1966, the company’s primary objective was to revolutionize cargo transport in India through containerization. CONCOR engages in various core businesses, including cargo carriers, terminal operations, warehouse operations, and MMLP (Multi-Modal Logistics Park) operations.
Investing in CONCOR presents an opportunity to participate in India’s growing logistics sector, leveraging the company’s dominant market position and extensive infrastructure.
#11. Bharat Heavy Electricals Limited (BHEL)
Bharat Heavy Electricals Limited (BHEL) holds a 67% market share in the power equipment sector. It is India’s foremost engineering and manufacturing company and a leading global producer of power equipment.
BHEL offers a wide range of services and products, including power-thermal, hydro, transmission, transportation, defence & aerospace, oil & gas, nuclear, solar PV, water and gas solutions.
Additionally, BHEL holds the largest market share in India for pollution control equipment, further establishing its position as a key player in the industry.
With its extensive portfolio and commitment to quality, BHEL continues to contribute significantly to the power sector and related industries in India and abroad.
Conclusion
Investing in monopoly stocks offers stability and growth potential, but it’s important to consider the associated risks. Identifying monopoly stocks requires careful analysis, and they have a notable impact on the Indian economy.
Understanding and evaluating monopoly stocks in India is essential for you to diversify your portfolios and capitalize on market opportunities. Conducting thorough research and staying updated with market trends are key to successful investment in monopoly stocks.
FAQs
Yes, to a certain extent. The Indian Energy Exchange Ltd (IEX) holds a dominant position in the energy trading market, specifically in short-term electricity contracts, with a market share of 95%.
However, it faces competition from other power exchanges in the long-term contracts segment.
Some stocks that have a monopoly in India include Indian Railway Catering and Tourism Corporation Ltd (IRCTC) in the ticketing business, Hindustan Aeronautics Ltd (HAL) in defense manufacturing, and Nestle in the cerelac industry.
The best monopoly stocks are those held by companies that dominate their respective markets or industries, enjoying a significant market share with limited or no competition. for example IRCTC, IEX, HEL, and Nestle.
A company becomes a monopoly when it holds exclusive control over a particular market or industry, either due to limited competition or barriers to entry.
Monopoly stocks hold a dominant position in their respective industries, often enjoying a high market share and influencing market dynamics.
Monopoly stocks can limit competition, making it challenging for smaller companies to gain market share and compete effectively.
The four kinds of monopolies are:
#1. Natural Monopoly: This type of monopoly occurs when a single company can efficiently provide goods or services due to the presence of high fixed costs and economies of scale. Examples include public utilities like water and electricity providers.
#2. Geographic Monopoly: A geographic monopoly exists when a company has exclusive control over a market in a specific geographic area. This can be due to limited competition or barriers to entry, such as patents or licenses.
#3. Technological Monopoly: Technological monopolies arise when a company possesses exclusive rights or control over a particular technology or innovation. This can be achieved through patents, copyrights, or trade secrets.
#4. Government Monopoly: Government monopolies occur when a government entity holds exclusive control over the production or distribution of certain goods or services. Examples include postal services, defense industries, or public transportation systems.
