Best PSU Stocks in February 2025 Based on 5-Yr CAGR: RVNL, HAL, BDL & More

Public Sector Undertakings (PSUs) have long been a cornerstone of India’s economy, playing a crucial role in driving economic growth and ensuring the country’s energy, infrastructure, and industrial development. These government-owned corporations span a wide range of sectors, including energy, banking, utilities, and defence, providing essential services and contributing significantly to government revenue. In this article, check the best PSU stocks list in February 2025, based on the 5-yr CAGR and other parameters like market cap and debt to equity.

Best Government Stocks in India February 2025 – Based on 5yr CAGR

Note: The best PSU stocks list provided here is as of January 29, 2025. The stocks are sorted based on their 5-yr CAGR.

Overview of the Best PSU Stocks in February 2025

• Rail Vikas Nigam Ltd (RVNL)

Rail Vikas Nigam Ltd takes up different kinds of rail infrastructure projects assigned by the Ministry of Railways (MoR), such as doubling, gauge conversion, new lines, railway electrification, major bridges, etc. In H1 FY 2025, the company’s total income was ₹9,472.82 crore, a drop from ₹11.063.52 crore during the same period in FY 2024. The net profit was ₹510.82 crore, a drop from ₹737.51 crore during the same period in FY 2024.

Key metrics:

• Return on Equity (ROE): 19.69%
• Return on Capital Employed (ROCE): 17.44%

• Hindustan Aeronautics Ltd (HAL)

Hindustan Aeronautics Ltd is into the manufacturing of aircraft and helicopters and repairs and maintains them. The company is a Navaratna Status Public Sector Undertaking (PSU) under the Ministry of Defence. In H1 FY 2025, the company’s total income was ₹11,60,255 lakh, an increase from ₹10,43,036 lakh during the same period in FY 2024. The net profit was ₹2,94,763 lakh, a rise from ₹2,05,076 lakh during the same period in FY 2024.

Key metrics:

• ROE: 28.91%
• ROCE: 24.58%

• Bharat Dynamics Ltd (BDL)

Bharat Dynamics Ltd was incorporated as a PSU under the Ministry of Defence. The company is engaged in the manufacturing base for guided missile systems and allied equipment for the Indian Armed Forces. In H1 FY 2025, the company’s revenue from operations was ₹735.94 crore, a drop from ₹913.53 crore during the same period in FY 2024. The net profit was ₹129.75 crore, a drop from ₹188.91 crore during the same period in FY 2024.

Key metrics:

• ROCE: 11.34%
• ROE: 17.89%

• Bharat Electronics Ltd (BEL)

Bharat Electronics Ltd is a Navratna PSU under the Ministry of Defence, Government of India. BEL offers advanced electronic products for the Indian Army. The company has achieved a turnover of ₹8,530.43 crore, marking a growth of 15.83% in the first half of FY 2024-25, compared to ₹7,364.82 crore during the same period last year. The PAT for the first half of FY 2024-25 stood at ₹1,867.41 crore, reflecting a growth of 39.03% over the PAT of ₹1,343.18 crore recorded in the corresponding period of the previous year.

Key metrics:

• ROCE: 30.17%
• ROE: 26.37%

• Bharat Heavy Electricals Ltd

Bharat Heavy Electricals Ltd (BHEL) is a leading integrated manufacturer of power plant equipment, specialising in the design, engineering, production, installation, testing, commissioning, and servicing of a wide array of products and services. For the 9M ended December 31, 2024, the company’s total income was ₹19,662.15 crore, a rise from ₹16,022.21 crore during the same period in FY 2024. The PAT for the period 9M ended December 31, 2024, stood at ₹29.45 crore, compared to a loss of -₹207.40 crore during the same period in FY 2024.

Key metrics:

• ROCE: 3.18%
• ROE: 1.16%

Best PSU Stocks in India – Based on Market Cap

Note: The best PSU stocks list provided here is as of January 29, 2025. The stocks are sorted based on their market capitalisation.

Best PSU Stocks in India – Based on Low Debt to Equity 

Note: The best PSU stocks list provided here is as of January 29, 2025. The stocks are sorted based on their debt to equity.

Conclusion

Apart from the PSU stocks list provided above, there are several other companies from the state and central government. Before investing in any stock it is vital to understand the business of the company, their financials and future prospects. Understand your investment objective and risk appetite before making a decision.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.