Introduction

In this blog, we will be covering the top 10 most expensive shares in India 2024. The term “most expensive” means the share is either among the highest prices per share at a particular period or it’s expensive relative to the company’s fundamentals.

The High price of a share is often associated with well-established companies with a history of consistent growth and profitability. However, a high price doesn’t mean that it’s among the best stocks, as equity markets are highly volatile and prices keep changing.

Expensive relative to the company’s fundamentals refers to the stocks whose prices are high as compared to the company’s financial performance. Inorder to determine this, investors and analysts, do analyse the company’s Price-to-Earnings (P/E) Ratio, Price-to-Book (P/B) Ratio, etc.

How can the financial metrics of a stock be analyzed to evaluate its financial performance?

The financial metrics of a stock to be analysed for evaluating its financial performance are as follows.

1. Price to Book Value (P/BV) ratio

The price-to-book (P/BV) ratio is a financial metric that investors use to determine a stock’s valuation by comparing its current market price to its book value. A company’s book value is its total assets minus its total liabilities. 

A higher P/B ratio usually means the stock is more expensive, while a low P/B ratio could mean the stock is undervalued or stressed.

 Here are some ways the P/B ratio can indicate a stock’s expensiveness:

a) P/BV < 1

A stock trading below its book value could be a promising sign of an undervalued opportunity. However, it’s important to note that a low P/BV ratio should be accompanied by a high return on equity (ROE) to confirm that the stock is undervalued.

b) P/B > 1

The stock is trading above its book value, which could imply overvaluation. For example, if a company has a P/B value of three, its stock trades at three times its book value. 

It is most useful when comparing a company to its industry peers or historical data. However, the P/B ratio does not provide a complete picture of a company, especially for sectors like information technology (IT). When combined with other valuation metrics, the P/B ratio can offer a more thorough analysis, helping investors make more informed decisions.

2. Price-to-Earnings (P/E) Ratio

The Price/Earnings (P/E) ratio is a valuation metric calculated by dividing a company’s current stock price by its earnings per share (EPS). It provides insight into how much investors will pay for each rupee of a company’s earnings.

Understanding the P/E ratio can be a powerful tool for investors. A low P/E ratio often indicates a stock’s price has fallen faster than its earnings, potentially signalling a good buying opportunity. On the other hand, a high P/E ratio may suggest that the stock is relatively expensive, which could lead to a potential price decline. This understanding can empower investors to make informed decisions about buying or selling stocks.

3. Other measures

Other measures such as the Key performance indicators like the Return on Investment (ROI), Return on Assets (ROA), Return on Net worth (RoNW), the strong financial history of the company, etc., help to analyse a stock’s relatedness and financial soundness in the market.

What are the other fundamental factors affecting the expensiveness of a stock?

1. Demand and Supply

Supply and demand are two main factors that influence stock prices. When demand is higher than supply, prices rise; prices drop when supply is higher than demand. For example, the price increases if there is more demand for a stock than the available supply, and vice versa. This factor determines the expensiveness of a stock.

2. Market Sentiments

Human psychology, emotions, rumours, news, and major geopolitical events influence stock prices. Speculation about a company’s profits can lead to stock sell-offs, while positive news can increase stock purchases. Traders also monitor geopolitical events and anticipate potential profit dips during tension, such as a boycott of a company and its products. This can lead to shareholders selling their holdings, causing the stock price to decline. Market sentiments can influence the price of a stock.

3. Fundamentals of the company  

Understanding a company’s performance is crucial in the stock market. Traders analyze changes like new management or rebranding to predict stock price movements. Research and analysis, relying on reports and expert opinions, can give traders a competitive edge and help them make more informed decisions.

Below are the 10 most expensive stocks in India 2024:

SL No.	Stocks	Stock Price (Rs) as on July 31, 2024	Market Cap (Rs in Crores) as on July 31, 2024	Category	P/E Ratio	Industry P/E	P/BV Ratio	5 Year Return	Sector
1	MRF Ltd	1,42,011.00	60,228.00	Large Cap	28.43	27.12	3.54	165.26%	Tyres
2	Honeywell Automation India Ltd	54,505.95	48,191.00	Large Cap	94.89	52.87	13.19	136.24%	Electronics – Components
3	Page Industries Ltd	42,200.00	47,069.00	Large Cap	83.38	51.78	29.72	132.18%	Lifestyle
4	3M India Ltd	39,275.00	44,243.56	Large Cap	76.39	74.49	20.76	86.34%	Diversified
5	Bosch Ltd	34,800.00	1,02,637.87	Large Cap	55.59	23.68	8.53	140.93%	Auto Ancillary
6	Abbott India Ltd	28,334.05	60,207.88	Large Cap	49.9	26.76	16.21	238.05%	Pharma
7	Shree Cement Ltd	27,677.80	99,863.57	Large Cap	41.42	27.27	4.79	37.31%	Cement
8	DISA India Ltd	20,225.00	2,941.00	Small Cap	64.66	28.07	11.78	304.53%	Engg – Industrial Equipments
9	Proctar and Gamble Hygiene and Healthcare Ltd	16,930.00	55,008.00	Large Cap	74.27	40.82	52.58	54.86%	FMCG
10	Maruti Suzuki India Ltd	13,167.95	4,06,145.00	Large Cap	30.05	31.08	4.73	140.64%	Auto – Cars

Note: The data available for the financial metrics and ratios is based on the recent data published by the companies on stock exchanges for the period April 1, 2023 to March 31, 2024.

1. MRF Tyres

MRF Tyres is the largest tyre manufacturer in India ranked amongst the top 20 manufacturers in the world. MRF is India’s largest Original Equipment Manufacturer (OEM). It supplies tyres for a variety of vehicles, i.e. from two-wheeler to fighter-aircrafts. Founded in 1946 by KM Mammen Mappillai, the company is headquartered in Chennai, India. The company’s manufacturing units is in Trichy, Tiruvottiyur and Arakonam in Tamil Nadu, Kottayam in Kerala, Ponda in Goa, Medak in Andhra Pradesh and the Union Territory of Pondicherry.

2. Honeywell Automation India

Honeywell Automation India Limited (HAIL) is a leader in the software solutions and process control equipment industry. HAIL was incorporated in the year 1984, and has its registered office in Hadapsar, Pune.

It was initially incorporated as Tata Process Controls private limited in Maharashtra. It became a public limited company in May 1987. Tata later sold 40.62% of the company’s share to Honeywell Asia Pacific Inc, USA. Honeywell Asia pacific Inc. (HAPI) was merged into HAIL Mauritius Limited, resulting in 75% of the shareholding in the company from HAPI to HAIL Mauritius.

3. Page Industries Limited

Page Industries limited was incorporated in 1995, and is headquartered in Bangalore, India.

The Company has the exclusive rights to make, sell, and advertise JOCKEY brand products in India, Sri Lanka, Bangladesh, Nepal, Oman, Qatar, Maldives, Bhutan, and the UAE. It also has the exclusive rights to manufacture, market, and distribute Speedo brand products in India.

The Page Industries Ltd was started in Bengaluru by making, selling, and promoting Jockey products. Later, it obtained a license to produce and sell swimwear under the globally recognised brand, ‘SPEEDO’.

4. 3M India limited

3M India limited was incorporated in India in the year 1987 and is a subsidiary of the American multinational conglomerate 3M. The company operates across various sectors, including consumer goods, healthcare, and industrial products. With its roots in innovation and product diversity, 3M India Ltd has established itself as a key player in the Indian market, offering a diverse portfolio of high-quality products and solutions for consumers, healthcare professionals, and industrial clients.

5. Bosch Limited

Bosch Limited is the main company of Robert Bosch Company in India. It is headquartered in Bengaluru and has manufacturing facilities in Nashik, Naganathapura, Jaipur, Gangaikondan, Chennai, and Bidadi.

In India, Bosch is a leading supplier of technology and services in Mobility Solutions, Industrial Technology, Consumer Goods, and Energy and Building Technology. Bosch has the largest development centre outside Germany for engineering and technology solutions in India. The Bosch Group operates in India through 12 companies, including manufacturing sites and development centres. It has 17 manufacturing sites and seven development and application centres in India.

6. Abbott India Limited

Abbott India Ltd. is a major pharmaceutical and healthcare company in India. It was originally incorporated in 1910. The Company offers a diversified range of medical products and services, including diagnostic solutions, medical devices, nutritional products, and pharmaceuticals for all stages of care.

The Company Abbot India Limited sells products through independent distributors within India and offers solutions in various health categories, including Women’s Health, Gastroenterology, Central Nervous System, metabolic, Multi-Specialty, Vaccines, and Consumer Health. It’s divided into four divisions: Primary Care, Specialty Care-Metabolics and Urology, Specialty Care-Neuroscience, and Hospital Care.

7. Shree Cement Limited

Shree Cement Ltd. is one of the leading cement manufacturers in India. The Company is headquartered in Kolkata and was established in 1979. They have manufacturing operations in six states in North and East India.

Shree Cement offers three brands: Shree Ultra Jung Rodhak Cement, Bangur Cement, and Rockstrong Cement. The manufacturing units are in various states, including Rajasthan, Uttarakhand, Bihar, Haryana, Chhattisgarh, and Uttar Pradesh. Industrialist Hari M Bangur leads the Company and is one of the largest cement producers in Rajasthan and the largest single-location manufacturer in Northern India.

8. DISA India Ltd

DISA India limited was formerly known as George Fisher Disa. DISA India Limited is a part of Cophenhagen DISA A/S Group that manufactures foundry machinery like moulding plants, and shot blasting machines. In India, the company is headquartered at Bengaluru, India.

The Company is a leading equipment manufacturer with advanced technology for making metal castings and preparing surfaces. It supplies complete systems for producing metal castings with various moulding machines, sand mixers, various equipment for handling sand, machines for preparing surfaces, and systems for controlling the environment. DISA India Ltd has two manufacturing plants in Tumkur and Hosakote in Bangalore, Karnataka.

9. Proctar and Gamble Hygiene and Healthcare limited

Procter & Gamble Hygiene and Health Care Limited (P&GHHCL), a company with a robust history and extensive experience, specialises in manufacturing and selling branded, fast-moving consumer goods in the healthcare and personal care sectors.

Established on July 20, 1964, in Mumbai, the Company’s long-standing presence in the industry is a testament to its stability and reliability. The Company operates manufacturing facilities in Goa and Baddi in Himachal Pradesh, utilising third-party manufacturing locations throughout India.

This strategic approach allows P&GHHCL to efficiently produce and distribute its products to meet the country’s diverse consumer demands.

10. Maruti Suzuki India Ltd

Maruti Suzuki India Ltd is the Indian subsidiary of Suzuki Motor Corporation. Established in 1981 as Maruti Udyog Limited, it is India’s largest passenger car company, accounting for over 50% of the domestic car market. The company offers a full range of cars, from the entry-level Maruti Alto to sedans, DZire, SX4 and Sports Utility Vehicle, Grand Vitara. It has two manufacturing facilities in Gurugram and Manesar in Haryana, producing around 1.5 million units annually.

Frequently Asked Questions (FAQs)

What is the EPS ratio?

EPS (Earning Per Share) is a financial ratio which is obtained by dividing earnings i.e. profit after tax (PAT) with average number of outstanding shares over a period.

How is EPS calculated?

EPS = (Net Income – Preferred Dividends) / End of period

Shares Outstanding EPS = (Net Income – Preferred Dividends) / Weighted Average Shares Outstanding

What is P/E Ratio?

PE Ratio or Price to Earning Ratio is obtained after dividing market price per share by Earnings per share.

What does a high P/E ratio mean?

A high P/E ratio usually means that the stock might be expensive. There are also chances that the stock might be potentially overvalued.

What is P/BV Ratio?

Price to Book value ratio or the P/BV Ratio is a financial metric used by the investors to value stock.

It is obtained by dividing the Market price per share with Book value per share.

How’s the book value per share is determined?

It is the company’s book value divided by total number of outstanding shares. It’s one of the financial metric which help investors value its stock.

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