Five cash-rich large-cap stocks to watch

Mint

4 days ago

In a market obsessed with growth, cash often gets overlooked. But it's often what separates the strong from the weak.
At last count, over two dozen Nifty 500 companies had more cash on their books than debt, with some sitting on liquidity buffers upwards of ₹20,000 crore.
That's not just idle capital. For the right companies, it gives them an opportunity to invest, to innovate, to stay relevant without chasing debt-fuelled growth.
FY25 threw plenty of curveballs, such as rising input costs, uneven demand recovery, and geopolitics. Yet, a few large-cap companies not only held their ground but also came out stronger, with cleaner books and tighter execution.
In this editorial, we highlight five such cash-rich stocks.
Hindustan Aeronautics Ltd
HAL is India's largest defence aerospace manufacturer. It is among the few companies globally with end-to-end capabilities in the design, development, manufacturing, repair, and overhaul of aircraft, helicopters, and engines.
HAL's order book has nearly doubled in just a year. From ₹94,100 crore at the start of FY25, it has ballooned to ₹1,89,300 crore by year-end, despite booking revenues of over ₹30,100 crore in the year.
Manufacturing contracts totalled ₹1,02,300 crore and include big orders like the 240 AL-31FP engines worth ₹25,500 crore, 156 LCH Prachand helicopters worth ₹62,700 crore, and 12 new Sukhoi-30 aircraft.
It also bagged ₹19,200 crore in repair and overhaul contracts and ₹493 crore in export orders.
HAL has over ₹38,000 crore plus in cash and investments on its books, giving it immense financial strength to self-fund R&D and capex.
A large portion of its capex, ₹14,000-15,000 crore over five years, will go towards expanding capacity for new engine programs (GE-414, IMRH), setting up overhaul and testing facilities and backward integration into forgings and carbon fibre.
FY25 revenue rose 2% year-on-year. Ebitda (earnings before interest, taxes, depreciation, and amortization) margin remained strong at 31%. Operating leverage is expected to improve as more of the order book starts translating into revenues.
HAL expects LCA Mark-1A deliveries to hit full stride in FY26, with support from a newly commissioned third line in Nashik. Other platforms, including HTT-40 and LUH, are also scaling up production.
Despite near-term growth capped at 8-10%, the visibility is high. Over the medium term, double-digit revenue growth is likely, supported by large-scale manufacturing orders and exports. Operating margins are expected to stay healthy at around 27-31%.
Coal India Ltd
Coal India is the world's largest coal miner and India's most critical energy backbone. It powers nearly 40% of the country's commercial energy needs.
In FY25, coal production hit an all-time high of 781 million tonnes (mt), up 1% year-on-year, while offtake touched 763mt.
Even with modest volume growth, Coal India managed to post strong financials as operating margin remained robust at 33%, aided by stable realizations and cost controls. But revenue growth was flat.
The company's real strength is in its balance sheet. With zero long-term debt and ₹10,000 crore in net worth, the company has ample cash to fund growth and still reward shareholders. In FY25, Coal India paid out hefty dividends, translating to a massive dividend yield of over 5%.
Looking ahead, the company aims to raise production to 1 billion tonnes by FY29 and 1.22 billion tonnes by FY35. Capex will go towards expanding mechanised coal evacuation, digitisation, washeries, and first-mile connectivity.
Coal India is also placing strategic bets on diversification. This includes coal gasification projects (worth ₹2,480 crore) in partnership with BHEL and GAIL to convert coal into synthetic gas and chemicals.
Thermal power demand continues to rise, and with India's per capita electricity consumption still among the lowest globally, Coal India has high visibility on growth.
Siemens Ltd
Siemens is one of India's largest industrial automation and electrification players. The company is involved in power transmission, digital industries, mobility, and smart infrastructure.
So far, 2025 (the company follows a September year-end) has been a year of strategic shifts.
The company completed the long-awaited demerger of its energy business in March, sharpening its focus on high-growth verticals such as electrification, automation, semiconductors, and railway mobility.
Revenue rose 2.6% on-year to ₹4,260 crore in Q2 FY25, with smart infrastructure and digital industries offsetting some of the weakness in mobility and low-voltage motors. Order inflow jumped 43.5% on-year to ₹5,310 crore in the quarter, taking the total order book to a record ₹41,460 crore.
Profitability was under pressure as Ebitda margin contracted sharply to 11%, hurt by normalising product mix, higher input costs, and some spillover of demerger expenses.
Still, the business remains fundamentally sound, with a strong book-to-bill ratio of 1.25 and improving export contribution, now at 11.4% of revenues.
The balance sheet continues to be rock solid. Siemens has no debt and sits on over ₹6,000 crore in cash and bank balance.
Looking ahead, Siemens is poised to benefit from multi-year megatrends, digitisation of factories, EV infrastructure, clean energy investments, and railway modernization.
Capex across sectors such as data centres, pharma, semiconductors, and utilities is creating fresh demand for automation, smart grids, and electrification.
The company is also investing in new manufacturing capacity for vacuum interrupters and switchgear at Goa and Aurangabad.
Despite near-term margin headwinds, the growth outlook remains strong.
BSE Ltd
BSE is Asia's oldest stock exchange and a fast-growing exchange in India, with strong traction across equities, mutual funds, derivatives and SME fundraising.
Over the last year, it has reinvented itself with a fresh focus on derivative markets and monetizing digital infrastructure.
FY25 was a strong year. Consolidated revenue surged 105% on-year to ₹3,200 crore, while net profit more than doubled to ₹1,300 crore.
A large part of this was driven by sharp gains in transaction charges and a jump in mutual fund platform revenues.
StAR MF handled over 600 million transactions, and single stock derivatives turnover crossed ₹4,760 crore. With rising volumes, profitability is scaling faster.
Ebitda rose 63% to ₹1,800 crore with a margin of 58%. Derivatives contributed ₹550 crore to revenue in FY25, up nearly 7X from the year before.
The company ended FY25 with over ₹5,100 crore in cash and investments on the books.
Looking ahead, BSE sees continued traction in equity and derivatives trading. It plans to launch a new debt platform and a gold spot exchange. Investments in regulatory tech, cyber infra, and SME engagement are expected to sustain momentum.
HCL Technologies Ltd
HCL Technologies is one of India's leading IT services exporters. The company enjoys a growing global presence in engineering, cloud, and enterprise software. It has also been quick to embed AI across its service offerings and internal operations.
In FY25, revenue rose 4.7% in constant currency to ₹1,15,360 crore, with services growing 4.8% and software up 3.5%. Ebit margin held steady at 18.3% despite a tough demand environment.
New deal momentum stayed strong. The company booked $9.3 billion worth of net new contracts during the year, the second-highest in its history. Engineering and R&D services were a key driver, supported by wins in telecom, financials, media, and auto.
GenAI deployments scaled up rapidly, with over 500 use cases across 400 clients, powered by HCL's AI Force, AI Foundry, and AI Labs platforms.
HCLTech remains a highly cash-generative business. Free cash flow touched ₹20,650 crore, and the company ended the year with cash of ₹30,240 crore.
For FY26, the management has guided for 2-5% revenue growth and Ebit margin between 18-19%.
The company will focus on expanding the public sector vertical in the US, AI-led application services, and ramp-up of large cloud and digital engineering deals.
Conclusion
As investors chase the next big opportunity, cash-rich large-cap stocks offer resilience. These companies are not just sitting on idle capital.
They are deploying it selectively into capacity, innovation, and shareholder returns. In a market that often swings between hope and hype, balance sheet strength can be a powerful differentiator.
But cash is only part of the story. What matters more is how it's used to drive earnings visibility, weather cycles and fund future growth without overreach.
For long-term investors, these businesses offer stability without losing sight of ambition. The key is to separate those merely hoarding liquidity from those turning it into a strategic advantage.
Happy Investing.
Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such.
This article is syndicated from Equitymaster.com.