List Of Top 10 Debt Free Companies In India 2021

Debt Free Companies In India

A debt free company in India are the companies which has zero debt which is why these are also known as debt-free companies.

If a company is showing zero debt in its balance sheet or if the company having no such outstanding loans in its balance sheet and possessing the full control over the finances of the company.

Debt free companies are generally self-reliant in making their decisions as they have few liabilities. The debt-free companies are generally free in regard to investing their money or funds for enhancing the overall performance of the companies.

If we observe the situation of lockdown i.e. during 2020 and 2021, there are various companies which are struggling with high debts while others facilitating growth because of being debt-free or zero debt company.

Pros And Cons Of Debt Free Companies

Pros Of The Debt Free Companies

  • Debt free companies have fewer responsibilities regarding paying any interest on a loan.
  • The debt free companies have a strong financial capacity which means the debt free companies have almost zero probability of being bankrupt.
  • Having strong finances, the debt free companies give a better performance.

Cons Of Debt Free Companies

  • In the case of equity finances, such debt free companies or zero debt companies may result in paying high taxes.
  • The company may result in a low earning per share ratio if the equity finances are preferred by any debt free company over the debt finances.

Top Debt Free Companies In India 2021

1. Hindustan Unilever Ltd

It is a household & personal products company. This is one of the most growing companies with almost producing 44 brands and 14 different categories. The market cap of this company is worth Rs. 545762.5 crore.

2. Bajaj Holdings & Investment Ltd (BHIL)

It is an NBFC that stands for Non-Banking Financial Company which is a de-merger of three companies since 2007 and such three entities are: Bajaj Auto Ltd, Bajaj FinServ Ltd, and BHIL.

This demerger of these three entities resulted in an increase in the market capitalization of these business associations.

3. HDFC Life Insurance Company Ltd

It is an Insurance company. This company was established in 2000 with almost 421 branches as being India’s leading life insurance providing companies.

4. SBI Life Insurance Company Ltd

It is an insurance company. This company was registered in 2001 with Insurance Regulatory and Development Authority as it is an amalgamation of the State Bank of India which is the largest bank of India. The quarter net profit of this company is Rs. 232.85 crores.

5. SKF India

In India, it was set up in 1923 and dealing in facilitating Industrial and automotive solutions like lubrication solutions, seals and other services.

6. ICICI Prudential Life Insurance Company Ltd

It is an insurance company. This company is well known life insurance company and this company is the first private insurer of India which has crossed almost Rs.1 trillion marks in Assets under Management since its establishment year i.e. 2001.

7. HDFC Asset Management Company Ltd

It is a finance asset management. This company is a result of a joint venture that occurred between HDFC and Standard life investments (SLI).

26.1% of this company is under the public undertaking. This company deals in HDFC mutual Fund Schemes. The company management is very well known for the ways of managing and dealing with its assets and debts as well. The market cap of this company is Rs. 63295.55 crores.

8. Maharashtra Scooters

It was found in 1975 dealing with the scooter and also grown its skills of manufacturing, die casting, fixtures, etc. but as per the low demand of scooters, this company shifted from manufacturing scooters towards manufacturing casting dies, fixtures, etc.

9. Whirlpool India Ltd

This company is a famous manufacturer of washing machines, refrigerators, microwaves,s, etc. Its quarterly net profit is worth Rs. 64.37 crore. This company has existed for a long time and the management is balancing debts and growth simultaneously.

10. CDSL

CDSL stands for Central depository services (India) Ltd. Which provides or deals in holding securities in the dematerialized form. It also enables the transactions done in securities. It has become the largest depository of India with almost over 2 crore active De-mat accounts.

Also Read: What Is Debt Financing, Types Of Debt Financing, Advantages & Disadvantages Of Debt Financing

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It becomes very crucial to understand that a company is required to be debt-free in regard to selecting a company for making an investment as it is simple that debt plays a vital role in a business as it facilitates growth.

Thus, after analyzing it is cleared that if a company is efficient in handling its debt as well as its growth; that company is better or to be chosen for making an investment.

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