Blue Chip Companies

Every company is different. All because of its life, business model, earning capacity, and much more. But some companies are more important. Reasons may be different. investors Called them Blue chip. The name “blue chip” came from the game of poker. In the game, the blue chips have the highest value. Widely recognized, well established and financially sound companies are also known as blue chip companies. their products are also well known high quality products and services. all of this companies are safe guard your investments all because of their huge revenue, good profitability, good utilization of resources and possibly high % of return on equity which is a reason of the dividend also. the list is different in all over the world. say Microsoft is Blue chip in US market. Coal India, HDFC is Blue chip in India and so on. whatever the names, criteria are same all over the world and it is accepted by many analysts. Blue chip stocks are seen as a less volatile investment than owning shares in companies without blue chip status because blue chips have an institutional status in the economy. In the investment world, a blue-chip company is well-known, well-established and well-secured. It is considered to be a leading company in its sector and produces dominant goods or services. Generally, a blue-chip company is impervious to economic downturns, which contributes to its qualities of generating consistent revenues and stable growth. It is usually considered a household name. one another similarity is that most of Blue Chips survived from many adversities. From Apple to Microsoft, Coal India, Maruti Suzuki, ONGC, Johnson & Johnson, TESCO, SIEMENS and so on. their business Model is different with their peers. It is one more reason. lets say Microsoft. If this company was not there. today’s era possibly is different. lets say IBM. Apple is king all over the world, but king of kings is IBM still because they are still exist. one another characteristics. some times this companies are MNC’s and having many subsidiaries. say VODAFONE, AUDI, ONGC, P&G and so on. Interesting fact is US have their Index which follow mostly all BLUE CHIP STOCKS. it is DOW Jones Industrial Average. India don’t have anything like it. but there are some big stocks listed on exchang which are tracked by many analyst. They are HDFC and HDFC bank, ICICI, SBI, ONGC, HUL, COAL INDIA, L&T, Maruti Suzuki, Tata Motors, Tata steel. One big indicator is most of Bluchips are known for their dividend history. So if you don’t know anything and if you start finding large cap stocks which are paying steady dividends then most of your list is contained with bluechip. going to end this post with a statement that Bluechips are the stocks which teach you the importance of long term investments. they never give rerurn in one day but still they are one of the best investment opportunity.

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About Ashutosh Tilak

Tracking Indian Capital Market since 2010. Finance Student, On this blog I am writing about finance and Investing. You can contact me analystashu@gmail.com or @androidashu & @InsideFinanc on twitter