In this article, we will discuss
- What is Sensex?
- Sensex Stocks to Buy in 2023: Top 10 Picks for Investors
- Why are These Stocks the Best Sensex Stock to Watch out for in 2023?
The Indian stock market has been on a roller coaster ride in 2022, with the Sensex hitting new highs and lows amid various global and domestic factors. As we are in 2023, investors are looking for opportunities to make profits and diversify their portfolios. But which stocks should they watch out for in the new year? In this article, we will list the top 10 Sensex stocks that have the potential to deliver strong returns and growth in 2023. These stocks are based on the recommendations of top brokers and analysts in the country, who have considered various aspects such as earnings, valuations, fundamentals, sector outlook, and prospects. Whether you are a long-term investor or a short-term trader, these stocks can help you achieve your financial goals in 2023. So, without further ado, let’s dive into the top 10 Sensex stocks to watch out for in 2023.
What is Sensex?
Sensex is the short form of S&P BSE SENSEX, which stands for Standard & Poor's Bombay Stock Exchange Sensitive Index. It is the benchmark index of the Bombay Stock Exchange (BSE). It consists of the top 30 companies listed on BSE. The index was launched in 1986 and is operated by S&P. It is calculated in Indian rupees and U.S. dollars. The index is float-adjusted and market-capitalization-weighted.
The Sensex reflects the overall sentiment of the Indian economy and the stock market. It tracks the performance of the 30 companies across various sectors such as banking, IT, FMCG, oil and gas, auto, etc. The companies are selected based on market capitalization, liquidity, turnover, and industry representation. The index is reviewed every six months, and changes are made accordingly.
The Sensex is one of the most widely followed indices in India and abroad. It is used by investors, analysts, media, and policymakers to gauge the health and direction of the Indian economy and market.
Sensex Stocks to Buy in 2023: Top 10 Picks for Investors
- Reliance Industries Limited (RIL)
- Tata Consultancy Services Limited (TCS)
- Housing Development Finance Corporation Limited (HDFC)
- Infosys Limited (INFY)
- Hindustan Unilever Limited (HUL)
- ICICI Bank Limited (ICICIBANK)
- State Bank of India (SBIN)
- Larsen & Toubro Limited (LT)
- ITC Ltd (ITC)
- Tata Motors (TM)
1. Reliance Industries Limited (RIL)
Company Information
Reliance Industries Limited is India’s largest private sector company and a global Fortune 500 corporation. It operates in various sectors, such as energy, materials, retail, entertainment, and digital services. Reliance’s offerings reach millions of Indians across different segments of society. Dhirubhai Ambani established the company and is now led by his son, Mukesh Dhirubhai Ambani. The Ambani family holds about half of the company’s shares. Refining & Marketing Business (50% of revenue) RIL has the world’s biggest refining hub in Jamnagar, with a capacity of 1.24 million barrels per day. It produces ~27% of India’s total oil refining capacity. It exports 57% of its refined products, uses 23% internally, and sells 18% in India. It also has 1,400 fuel stations in India.
Stock Information
| Market Cap (Cr): 1757371 | Face Value (₹): 10 | EPS (₹): 99.49 |
| Book Value (₹): 1,152 | Roe (%): 9.42 | Debt to Equity: 0.41 |
| Stock P/E: 27.3 | ROE (%): 8.16 | Dividend Yield (%): 0.31 |
| Revenue (Cr): 642,162 | Earnings (Cr): 102,408 | Cash (Cr): 36,178 |
| Total Debt (Cr): 319,158 | Promoter’s Holdings (%): 50.54 |
2. Tata Consultancy Services Limited (TCS)
Company Information
Tata Consultancy Services (TCS) is an IT services company part of Tata Group based in India. TCS provides digital and consulting solutions to clients across industries. The top revenue generators for TCS are Banking, Financial Services, and Insurance (39%), followed by Retail and Consumer business (17%), Communication, media, and technology (16%), Manufacturing (11%) and other industries. TCS offers platforms, products, services, and solutions like TCS BaNCS, TCS Connected Intelligence Platform, TCS HOBS, business intelligence, cloud services, mobility, and engineering services, powering businesses in their digital transformations.
Stock Information
| Market Cap (Cr): 1146216 | Face Value (₹): 1 | EPS (₹): 105.46 |
| Book Value (₹): 244 | Roe (%): 54.9 | Debt to Equity: 0.09 |
| Stock P/E: 29.5 | ROE (%): 43.6 | Dividend Yield (%): 1.37 |
| Revenue (Cr): 184,868 | Earnings (Cr): 52,013 | Cash (Cr): 18,221 |
| Total Debt (Cr): 7,818 | Promoter’s Holdings (%): 72.05 |
3. Housing Development Finance Corporation Limited (HDFC)
Company Information
HDFC is an Indian financial conglomerate providing retail and corporate financial services like housing, life & general insurance, banking, asset management, and education loans. It is India's big housing finance provider with over 387 branches. HDFC was India's first housing finance company, incorporated in 1977, and has since grown into a diversified financial services company. HDFC is a pioneer in housing finance in the country and has helped create three more housing finance firms - Gruh Finance, SBI Home Finance, and Can Fin Homes. HDFC offers various financial products and services, including loans for home purchases, construction and repairs, insurance, investments, and commercial and rural finance.
Stock Information
| Market Cap (Cr): 429627 | Face Value (₹): 2 | EPS (₹): 126.19 |
| Book Value (₹): 990 | Roe (%): 8.6 | Debt to Equity: 2.83 |
| Stock P/E: 18.8 | ROE (%): 13.4 | Dividend Yield (%): 1.27 |
| Revenue (Cr): 47,354 | Earnings (Cr): 0 | Cash (Cr): 2,629 |
| Total Debt (Cr): 507,460 | Promoter’s Holdings (%): 0 |
4. Infosys Limited (INFY)
Company Information
Infosys is an Indian multinational corporation that provides business consulting, information technology, and outsourcing services. The company helps clients across industries in their digital transformation journeys through services like application development, product engineering, infrastructure management, digital experience, and more. Infosys operates globally with 220 locations across 46 countries. It has a presence across major industry verticals, including Financial Services, Retail, Manufacturing, Energy, Communication, and more. The company offers products and platforms like Finacle, Skava, Panaya, and LEAP to help clients execute their digital transformation strategies, optimize costs and implement new technologies like cloud, automation, and cybersecurity.
Stock Information
| Market Cap (Cr): 615063 | Face Value (₹): 5 | EPS (₹): 52.96 |
| Book Value (₹): 175 | Roe (%): 37.1 | Debt to Equity: 0.08 |
| Stock P/E: 27.6 | ROE (%): 29 | Dividend Yield (%): 2.12 |
| Revenue (Cr): 115,676 | Earnings (Cr): 30,917 | Cash (Cr): 13,982 |
| Total Debt (Cr): 6,059 | Promoter’s Holdings (%): 12.95 |
5. Hindustan Unilever Limited (HUL)
Company Information
Hindustan Unilever Ltd., India's largest FMCG company, operates in three key segments - Home Care, Beauty & Personal Care, and Foods. Beauty & Personal Care is its largest segment contributing 42% of revenues and delivering the highest margins of 29%. The company operates in multiple categories in this segment, with over 900 Stock Keeping Units catering to 14 consumer clusters in India. It has leading brands in skin cleansing, oral care, hair care, skin care, and cosmetics like Dove, Lifebuoy, Lux, and Vaseline. The company has manufacturing plants across India and primarily caters to the Indian consumer through an extensive distribution network.
Stock Information
| Market Cap (Cr): 605208 | Face Value (₹): 1 | EPS (₹): 39 |
| Book Value (₹): 209 | Roe (%): 24.4 | Debt to Equity: 0.02 |
| Stock P/E: 65.9 | ROE (%): 18.4 | Dividend Yield (%): 1.32 |
| Revenue (Cr): 51,112 | Earnings (Cr): 12,598 | Cash (Cr): 3,846 |
| Total Debt (Cr): 1,043 | Promoter’s Holdings (%): 61.9 |
6. ICICI Bank Limited (ICICIBANK)
Company Information
ICICI Bank is one of India's leading banks, offering a wide range of banking and financial services to retail and wholesale clients. The bank's key business segments are Retail Banking, which deals with individual customers; Wholesale Banking, focused on corporate and SME clients; Treasury managing the bank's liquidity and investments; and other segments that include life and general insurance. ICICI Bank provides various products and services such as savings and current accounts, home loans, cars, businesses, gold etc. The bank also offers Internet banking, mobile banking, SMS banking, insurance and wealth management services to its clients through a large network across India.
Stock Information
| Market Cap (Cr): 595852 | Face Value (₹): 2 | EPS (₹): 39.92 |
| Book Value (₹): 262 | Roe (%): 5.59 | Debt to Equity: 6.95 |
| Stock P/E: 21.5 | ROE (%): 14.8 | Dividend Yield (%): 0.58 |
| Revenue (Cr): 83,541 | Earnings (Cr): 0 | Cash (Cr): 183,126 |
| Total Debt (Cr): 1,252,968 | Promoter’s Holdings (%): 0 |
7. State Bank of India (SBIN)
Company Information
SBI is a Fortune 500, Indian multinational commercial bank and financial services company headquartered in Mumbai. Founded over 200 years ago, it is India's oldest and largest bank. Its segments include Treasury for investments, Corporate/Wholesale Banking for corporate clients, Retail Banking through branches and ATMs for individuals, and Insurance through subsidiaries. The bank provides various banking and insurance products and services targeting individuals, small businesses, large corporates, and institutional customers.
Stock Information
| Market Cap (Cr): 459484 | Face Value (₹): 1 | EPS (₹): 39.58 |
| Book Value (₹): 342 | Roe (%): 4.44 | Debt to Equity: 14.89 |
| Stock P/E: 11.3 | ROE (%): 12.2 | Dividend Yield (%): 1.38 |
| Revenue (Cr): 269,826 | Earnings (Cr): 0 | Cash (Cr): 398,905 |
| Total Debt (Cr): 4,536,570 | Promoter’s Holdings (%): 57.64 |
8. Larsen & Toubro Limited (LT)
Company Information
Larsen & Toubro Ltd is an Indian multinational conglomerate that provides engineering, procurement and construction solutions. Its segments include Infrastructure for buildings, transportation and civil infrastructure, Power for thermal power plants, Heavy Engineering for engineered equipment, and Defense Engineering for defense equipment. The company also manufactures equipment for the hydrocarbon, rubber processing, communication and mining industries and provides information technology and financial services. It has global operations focused on construction, engineering, manufacturing and technology domains.
Stock Information
| Market Cap (Cr): 264387 | Face Value (₹): 2 | EPS (₹): 65.46 |
| Book Value (₹): 587 | Roe (%): 11 | Debt to Equity: 1.53 |
| Stock P/E: 28.9 | ROE (%): 10.3 | Dividend Yield (%): 1.17 |
| Revenue (Cr): 151,758 | Earnings (Cr): 24,288 | Cash (Cr): 18,953 |
| Total Debt (Cr): 125,292 | Promoter’s Holdings (%): 0 |
9. ITC Ltd (ITC)
Company Information
ITC Limited is an Indian conglomerate operating in FMCG businesses like cigarettes, packaged foods, apparel, personal care and stationery; hotels, paperboards and packaging; and agriculture. Cigarettes contribute 45% to revenues and 84% to profits. It commands over 80% market share in the organized cigarette sector, manufacturing brands like Gold Flake, Insignia, and Classic. However, cigarette growth prospects remain constrained due to rising tax pressures and growing consumption of illicit duty-evaded cigarettes. The company also operates non-cigarette FMCG businesses like packaged foods, apparel, personal care and stationery products.
Stock Information
| Market Cap (Cr): 388579 | Face Value (₹): 1 | EPS (₹): 13.26 |
| Book Value (₹): 50.7 | Roce (%): 33.6 | Debt to Equity: 0.00 |
| Stock P/E: 23.8 | ROE (%): 24.8 | Dividend Yield (%): 3.67 |
| Revenue (Cr): 58,455 | Earnings (Cr): 19,930 | Cash (Cr): 4,654 |
| Total Debt (Cr): 249 | Promoter’s Holdings (%): 0 |
10. Tata Motors (TM)
Company Information
Tata Motors is a global automotive manufacturing company based in India with operations across different countries. Its product portfolio includes commercial and passenger vehicles and defense vehicles across different segments under the Tata and Jaguar Land Rover (JLR) brands. JLR, acquired by Tata Motors in 2008, includes Jaguar and Land Rover car brands. JLR contributes around 80% of Tata Motor's revenues. Together, Tata Motors and its subsidiaries manufacture a range of cars, sports utility vehicles, trucks, buses, and defense vehicles. The company operates through automotive and other segments, including vehicle financing and machine tools.
Stock Information
| Market Cap (Cr): 162075 | Face Value (₹): 2 | EPS (₹): -36.14 |
| Book Value (₹): 134 | Roe (%): 1.4 | Debt to Equity: 3.34 |
| Stock P/E: 0 | ROE (%): -22.3 | Dividend Yield (%): 0 |
| Revenue (Cr): 288,642 | Earnings (Cr): 29,811 | Cash (Cr): 40,669 |
| Total Debt (Cr): 146,449 | Promoter’s Holdings (%): 42.39 |
Why are These Stocks the Best Sensex Stock to Watch out for in 2023?
These stocks are the best Sensex stocks to watch out for in 2023 because they belong to the sectors expected to perform well in the new year. According to various brokerages and analysts, the Indian stock market outlook for 2023 is positive, with the Sensex likely to reach 68,500 by December 2023. The factors supporting the market include strong corporate earnings, low-interest rates, stable currency, recovery from Covid-19 and favorable policy reforms. The sectors that may benefit from these factors include financials, IT, consumer discretionary, industrials and metals. These sectors have shown robust growth in 2022 and have a strong pipeline of projects and orders for 2023. These Sensex stocks also have attractive valuations, strong fundamentals, competitive advantages, and good governance. Therefore, these stocks are the best Sensex stocks to watch out for in 2023.
Conclusion
In conclusion, these 10 Sensex stocks are the best to watch out for in 2023 because they have strong fundamentals, competitive advantages, growth prospects, and dividend payouts. These stocks belong to various sectors expected to benefit from the recovery of the Indian economy, the easing of inflation, and the improvement of earnings in 2023. These stocks also have a large market capitalization, high liquidity, and low volatility, which make them attractive to investors. These stocks have also performed well and have a positive outlook for the future. These stocks may outperform the market and generate superior returns for investors in 2023.
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