Best Government Stocks in India

When you ask any Indian investor about government stocks, they will respond in two very different ways. They are slow, uninteresting, and mired in bureaucracy, according to some. Some vouch for them, lauding their consistent dividends and government support.

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The truth? Both sides have a point. Not every PSU (Public Sector Undertaking) share is a winner, but a handful of them have delivered solid wealth over time, and continue to look promising. If you’ve ever wondered “Which are the best government stocks in India right now?”, this guide breaks it down for you. Let’s start with a quick snapshot.

Top Government Stocks in India

Why Investors Still Trust PSU Stocks?

PSU stocks are not flashy. You won’t usually see them doubling overnight like a small cap IT company. But what they do offer is consistency.

• Dividends that matter: Take Coal India. Its dividend yield has been approximately around 6% for years. That’s money back in your pocket, not just “paper profits.”
• Government cushion: Knowing the state stands behind companies like SBI or ONGC gives peace of mind, especially in volatile markets.
• Sector dominance: In power, energy, and defence, PSUs still control the bulk of the market.

Of course, there are drawbacks. Decision making can be slow, and growth isn’t always explosive. But for investors who like stability, PSUs continue to deserve a spot on the radar.

A Closer Look at the Best Government Stocks in India

1. State Bank of India (SBI)

If there’s one PSU stock that feels almost unavoidable, it’s SBI. What’s more interesting is how it has adapted, from pushing digital banking to improving loan quality.

It’s not just size; it’s execution. SBI is proof that some PSUs can grow aggressively while still offering the safety net of government ownership.

When people talk about the best government stocks in India, SBI almost always tops the list. It isn’t just the largest bank by assets, it’s also the most adaptive among PSU banks. From expanding digital platforms like YONO to keeping loan books healthier than before, SBI shows that a government-owned company can be both safe and ambitious.

2. NTPC Limited

Power is one of those sectors that never goes out of demand. NTPC, the country’s largest power producer, has long been a stable bet.

NTPC’s appeal lies in its reliability. As India’s largest power producer, it delivers steady cash flows that long-term investors love. But what makes it stand out today is its gradual shift into solar, wind, and even green hydrogen. For anyone eyeing top PSU stocks India has to offer, NTPC represents stability with a green energy edge.

3. Coal India Limited

Yes, renewable energy is the future. But let’s be real, coal is still India’s backbone for electricity. Coal India, with its near monopoly, continues to churn profits and reward investors with generous dividends.

If your goal is steady income, Coal India is hard to beat. You may not get explosive growth, but you’ll get reliability, and in investing, that counts for a lot.

Coal India is often labelled an old economy, yet it remains one of the top performing PSU shares India has ever seen in terms of dividends. Electricity demand still leans heavily on coal, and Coal India controls most of the supply. For income-focused investors, it’s not flashy growth but steady reliability, something many private players can’t always promise.

4. Bharat Electronics Limited (BEL)

BEL is riding India’s defence modernisation wave. With the government pushing “Make in India” in defence, BEL has secured strong orders.

Unlike many PSUs, this one has the flavour of a growth stock. Investors who want exposure beyond “safe and steady” should keep BEL on the watchlist.

BEL is different from many other government companies listed in NSE. While others move slowly, BEL has built a reputation for being agile in the defence electronics space. With Make in India policies boosting orders and exports opening new doors, BEL feels like a growth stock hiding inside a PSU tag. It’s one PSU worth watching closely.

5. ONGC (Oil & Natural Gas Corporation)

Oil and gas may sound old school, but ONGC is still India’s largest producer. Yes, its earnings swing with global crude prices, but the dividend yield and strong cash flows keep investors interested.

For long term portfolios, ONGC works well as a steady energy play, especially if bought during dips.

Among public sector undertakings, ONGC is a heavyweight. Oil and gas prices can be unpredictable, but ONGC balances that risk with generous dividends and unmatched scale. Recently, it has also started diversifying into renewables, showing that it isn’t stuck in the past. For long-term investors, it’s a classic government sector stock that provides both stability and cash flow.

Final Thoughts

Nowadays, the conversation around best government stocks in India isn’t about whether PSUs are good or bad. It’s about being selective. SBI remains a banking powerhouse, BEL brings growth, NTPC offers stability with a green energy push, Coal India ensures dividends, and ONGC adds energy exposure.

Investing in PSUs is about patience and balance. They may not grab headlines like high growth startups, but they often deliver quietly, through dividends, steady compounding, and sector dominance.