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Top Stocks to Invest for Long Term in Indian Share Market (2024)

Top Stocks to Invest for Long Term in Indian Share Market (2024)
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The stock market is a great way to build wealth over time. However, it’s important to have a long-term perspective and understand the benefits of investing in stocks for the long haul. Investing in the best stocks to buy for long term investment allows investors to ride out short-term market fluctuations and take advantage of compounding returns. In this article, we’ll discuss long-term stocks to invest in, how to pick them, and a list of best shares to buy for the long term.

Top Long Term Stocks to Buy in 2024 Based on 5Y Avg Net Profit Margin

When building a solid foundation for your investment portfolio, the key is to focus on long-term investment stocks for 2024. Therefore, let’s look at 10 best shares to buy today for the long term.

Stock NameSub-SectorMarket Cap (in cr)Share Price5Y-Avg Net Profit Margin
Power Grid Corporation of India LtdPower Transmission & Distribution₹3,02,874.16₹306.7030.39
Adani Ports and Special Economic Zone LtdPorts₹2,99,287.25₹1,383.5027.83
Divi's Laboratories LtdLabs & Life Sciences Services₹1,06,626.78₹4,412.8026.90
ITC LtdFMCG - Tobacco₹5,42,835.69₹423.8526.07
Bajaj Finance LtdConsumer Finance₹4,16,713.52₹6,616.4522.56
HDFC Bank LtdPrivate Banks₹11,09,143.47₹1,514.8519.96
Kotak Mahindra Bank LtdPrivate Banks₹3,37,600.41₹1,690.1019.27
Tata Consultancy Services LtdIT Services & Consulting₹13,82,181.79₹3,736.1019.22
Eicher Motors LtdTrucks & Buses₹1,27,955.39₹4,742.9518.02
Coal India LtdMining - Coal₹3,02,374.27₹483.9517.88

Disclaimer: Please note that the above list is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing.

Note: The data in this long term stocks list, including the long term share prices, is from 22nd May 2024. This data is derived from Tickertape Stock Screener.

🚀 Pro Tip: You can use Tickertape’s Stock Screener to research and evaluate stocks with over 200+ filters and parameters.

Best Long Term Investment Shares: Overview

Let’s look at the long term investment stock companies that you might be interested in investing in.

Power Grid Corporation of India Ltd

Power Grid Corporation of India Limited is a transmission company engaged in the power transmission business and is responsible for planning, implementing, operating, and maintaining the Inter-State Transmission System. Over the last 5 years, the debt to equity ratio has been 202.19%, vs the industry average of 206.94%. As of 22nd May 2024, the company’s market capitalisation is Rs. 3,02,874 cr. Based on the 5-yr avg net profit margin,  it is also one of India’ top 10 stocks to buy for long term investment in share market, as demonstrated on our list.

Adani Ports and Special Economic Zone Ltd

Adani Ports and Special Economic Zone Limited is a port infrastructure company engaged in developing, operating, and maintaining port and port-based infrastructure facilities. Considered one of the best shares to invest for long term on our list, this large-cap company accounts for nearly one-fourth of the cargo movement in the country. However, over the last 5 years, there has been a downturn in the revenue growth, net income, cash flow growth, and debt-to-equity ratio. As of 22nd May 2024, the company’s market capitalisation is Rs. 2,99,287 cr., and the 5-yr avg net profit margin is 27.83%.

Divi’s Laboratories Ltd

Divi’s Laboratories Limited specialises in producing and selling active pharmaceutical ingredients (APIs) and intermediates, offering a range of products that includes generic APIs, intermediates, peptide building blocks, and carotenoids. As of 22nd May 2024, the large-cap company’s market capitalisation is Rs. 1,06,626 cr. The company’s debt-to-equity ratio is 0.43%. Furthermore, the current ratio has been 630.68%.

ITC Ltd

ITC Limited is a conglomerate that markets fast-moving consumer goods (FMCG). The company operates through four business segments: FMCG, Hotels, Paperboards, Paper and Packaging, and Agri-Business. The large-cap company has grown at a yearly rate of 9.83% over the past 5 years. Furthermore, the stock has gradually increased its market share from 92.64% to 93.27% during the same period. As of 22nd May 2024, the large-cap company’s market capitalisation is Rs. 5,42,835.69 cr.

Bajaj Finance Ltd

Bajaj Finance Limited (BFL) is a prominent non-banking financial company (NBFC) with 73 million customers and assets under management totalling Rs. 4,16,713 cr. According to the Reserve Bank of India’s 2023 list of NBFCs, Bajaj Finance Limited secures the second position in the upper layer, following scale-based regulation guidelines. The company’s revenue growth has been impressive as it has grown at a yearly rate of 26.55% over the last 5 years. Furthermore, the company’s market share has increased from 12.65% to 22.71%.

HDFC Bank Ltd

HDFC Bank Limited provides various banking services, including commercial and investment banking for wholesale clients and transactional and branch banking for retail customers. The company’s revenue growth has been trending at a yearly rate of 15.09% over the last five years. Additionally, the company’s market share has gradually increased from 22.64% to 26.01% during the same period. The large-cap company has a market capitalisation of Rs. 11,09,143 cr. and a 5-year net profit margin of 19.96%.

Kotak Mahindra Bank Ltd

Kotak Mahindra Bank Limited is a Non-Banking Financial company. It offers a range of banking services covering commercial and investment banking on the wholesale side and transactional/branch banking on the retail side. The company prominently operates in three different segments: Vehicle Investing, Other Lending activities, and Treasury and investment activities. Over the past five years, the current ratio has been 16.9%, vs. the industry average of 11.88%. As of 22nd May 2024, the market capitalisation of Kotak Mahindra Ltd is Rs. 3,37,600.

Tata Consultancy Services Ltd

Tata Consultancy Services Limited (TCS) is a global leader in IT services, consulting, and business solutions, focusing on innovation and delivery excellence. The company operates through Banking, Capital Markets, Communications, Education, Energy Resources, Media, Information Resources and more. With a market capitalisation of Rs. 13,82,181 cr., the company’s debt-to-equity ratio is 1.16% as of 22nd May 2024. The company has shown a steady growth of 19.22% in net profit margin. Furthermore, the current ratio has been increased to 310.05%, while the industry average is 228.87%. 

Eicher Motors Ltd

Eicher Motors Ltd, an Indian multinational automotive company headquartered in New Delhi, is a prominent player in the Indian automobile industry. Present in the list of top 10 stocks in India, the company operates in business verticals, including motorcycles, commercial vehicles and personal utility vehicles. With a market capitalisation of Rs. 1,27,955 cr., the company is considered one of the best long-term stocks. The company’s debt-to-equity ratio is 8.16%, and the 5-yr net profit margin is 18.02%. Furthermore, the current ratio is 233.88%, compared to the industry average of 120.29%.

Coal India Ltd

Coal India Limited (CIL) is an Indian central public sector undertaking under the ownership of the Ministry of Coal, Government of India. The company is engaged in the production and sale of coal. It serves the power and steel sectors as well as the cement, fertiliser, brick, and kiln industries, among others. Under the list of top stocks in India, the debt-to-equity ratio has been 11.88%, equal to the industry average. As of 22nd May 2024, the company’s market capitalisation is Rs. 3,02,374 cr. with a 5-year net profit margin of 17.88%.

Investing in Long Term Investment Stocks via smallcase

Did you know that you can invest in readymade long term stock portfolios managed by SEBI-registered experts? Yes, that’s right. 

smallcases are modern investment products that help investors easily build low-cost, long-term & diversified portfolios. At smallcase, you can easily track and invest in specific sectors by diversifying your portfolio across different asset classes, market segments and capitalisations.

However, if you’re confused about which stocks to pick, you can explore smallcases:

  1. smallcases are readymade portfolios of stocks/ETFs, that are based on a theme idea or strategy
  2. They’re created and managed by SEBI-registered experts
  3. smallcase.com offers over 200+ stock portfolios, created by 180+ managers
  4. Some of the popular smallcases among new investors are as follows:

Equity & Gold smallcase by Windmill Capital

Top 100 Stocks smallcase by Windmill Capital

All Weather Investing smallcase by Windmill Capital

Disclosures for aforementioned smallcases

What are Long Term Investment Stocks?

Long term investment stocks mean investing in companies with strong fundamentals and growth potential that are held for several years. These long term investment stocks are different from short-term stocks because the latter are typically bought and sold quickly to make a short profit. Thus, the long-term investing strategy involves buying and holding long-term investment stocks that are focused on the company’s long-term growth prospects and fundamentals.

How to Invest in the Best Long Term Stocks India?

There are several ways to invest in stocks to invest for long term, including buying individual stocks, mutual funds, and exchange-traded funds(ETFs). Buying individual stocks allows investors to handpick their holdings, but carries a higher level of risk. Mutual funds and ETFs provide diversification and lower risk but may offer different potential for high returns. Investors should choose the best long term stocks to buy that best align with their investment goals and risk tolerance.

How to Pick Investment Stocks For Long Term?

When selecting the best share to buy for long term, it’s important to consider a various factors. Here are a few key considerations:

  • Company Financials: Look for companies with strong financials, including a healthy balance sheet, positive cash flow, and solid earnings growth.
  • Management Team: A strong management team with a track record of success can help ensure the company’s well-being, and you can consider it one of the long-term investment stocks.
  • Competitive Advantage: Consider buying stocks in India who have a competitive advantage, such as a strong brand, unique product, or proprietary technology.
  • Market Trends: Search for companies that are well-positioned to capitalise on market trends, such as the transition towards renewable energy or the expansion of e-commerce.

Factors to Consider Before Investing in Long Term Investment Stocks

Several factors can affect the best long-term stocks in India. These factors affecting the long term investment in share market include: 

  • Financial Performance: Evaluate the company’s revenue growth trends, profitability metrics like net income and operating margins, and cash flow to ensure a healthy business.
  • Growth Potential: When considering long-term stock purchases, look for companies that drive innovation and growth. A company that doesn’t build full-proof products backed by recent technology and innovation is bound to lose compared to the one that does. 
  • Macroeconomic Factors: Consider macroeconomic factors like interest rates and inflation that may impact a stock’s performance. 
  • Transparency: Check if the company is transparent in its disclosures. Avoid investing in businesses that lack proper and sufficient disclosures, especially concerning related party transactions.

Potential Risks of Investing in Long Term Investment Stocks

While many praise long-term investment stocks for their potential to yield substantial returns over extended periods, one might encounter certain challenges, such as:

  • Volatility: Investing in the stock market can be volatile, especially in the short-term. Stock prices can fluctuate based on market conditions, economic indicators, and company-specific news.
  • Lack of Liquidity: When you invest in best stocks for long term investment, you’re tying up your money in an asset that may be challenging to sell quickly. If you need access to your money in the short-term, there may be better options than investing in long term shares.
  • Company-specific Risks: Investing in a single company’s stock exposes you to company-specific risks, such as poor management, legal issues, or competitive threats.

Advantages of Long Term Investment Stocks

Let’s look at the promising benefits of investing in long term investment stocks. 

  • Potential for Higher Returns: Historically, the share market has provided share to buy in India with higher returns compared to other asset classes such as bonds, cash, and real estate.
  • Time in the Market, Not Timing the Market:  Trying to time the market can take time and effort. When investing in the best long term stocks, you don’t have to worry about timing the market or short-term fluctuations.
  • Lower Taxes: Long-term capital gains tax rates are lower than short-term capital gains tax rates. Therefore, if you hold onto a stock for more than one year before selling it, you’ll pay a lower tax rate on any gains.
  • Compounding: Shares to buy in long term allow you to take advantage of compounding. Thus, the longer you hold onto a stock, the more time it has to grow and increase in value. Resulting in significant gains over time.

Strategies to Select the Best Stock for Long Term Investment

Follow the given tips to select the best stocks to invest in 2024 India:

  • Avoid Blindly Following Market Tips: Refrain from blindly acting on stock market tips, no matter how credible the source. Thoroughly research and analyse  long time investment share before making decisions. While some tips may yield significant benefits, others pose the risk of substantial losses.
  • Remove Underperforming Stocks from Your Portfolio: Recognise that a stock’s previous decline may not guarantee a future rise. Be realistic about market possibilities and promptly sell underperforming stocks in your portfolio to mitigate further losses. Pragmatic decision-making is crucial while investing in the best shares for long term investment.
  • Manage Your Investment Budget Wisely: The best share for long term investment can be favourable. You should avoid hastily exceeding your investment budget. Allocate a fixed amount across diverse high-performing stocks instead of concentrating on one. Diversify your investments strategically to safeguard against undue risks and enhance long-term growth prospects.
  • Adopt and Stick to Your Investment Strategy: Choose a reliable investment strategy aligned with your goals before investing in the best share to invest for long term.  Conduct thorough fundamental and technical analyses, utilise stock screeners, and make informed decisions. A disciplined approach enhances your ability to select the best stocks for long term stocks success.

To Wrap It Up…

Long term investment stocks are a great way to build wealth over time, but it requires patience and a long-term perspective. By selecting strong companies with a proven track record of growth and diversifying holdings, investors can minimise risk and take advantage of long-term trends. It’s never too late to start investing in shares for long term, and with careful research and planning, anyone can build a successful long-term investment portfolio.

Frequently Asked Questions on Long Term Investment Stocks

1. What are the best stocks to buy for long term in India?

Based on the 5-year net profit margin, here is a list of the best stocks to buy for long term in India 2024.
(a) Power Grid Corporation of India Ltd
(b) Adani Ports and Special Economic Zone Ltd
(c) Divi’s Laboratories Ltd
(d) ITC Ltd
(e) Bajaj Finance Ltd

Note: This list of best shares to invest in 2024 is for educational purposes only and not recommendatory.

2. How can I invest in the best stocks to buy in India for long term?

By following these steps, you can increase your chances of success when it comes to the best shares to buy for long term investment.
1. Do your research
2. Choose a reputable stockbroker
3. Invest for the long term

3. Is it a good time to invest in long term investment stocks?

Yes, investing in stocks for long-term investment is a relatively good investment option as it helps you fight the highs and lows of the market without impacting your portfolio to a great extent.

4. Who should invest in long term investment stocks?

People who have a long-term investment horizon and can tolerate short-term volatility can consider long term shares to buy in India 2024.

5.  Which sector will grow in the next 3 years?

In the upcoming 3 years, investing in best stocks to invest for long term belonging to Banking, NBFCs (Non-Banking Financial Companies), and MFIs (Microfinance Institutions) presents promising opportunities due to the significant rise in credit growth.