Old Economy Stocks Vs New Economy Stocks

Stocks of listed companies offer investment opportunities to investors. Offering ownership of a company, the shares, and their corresponding price is connected with its overall profitability and growth.

With a paradigm shift in the economy, new companies and their business models are emerging at a faster pace making it imperative for investors to understand the key differences between old economy and new economy stocks.

Let’s dive into the topics and explore the key differences between the old and new companies and the investment opportunities they offer:

Old economy stocks:

As evident from its name, the old economy stocks represent shares of Companies that are well established and have existed for a considerable period of time. Such companies belong to industries like manufacturing, construction, banking, and other tangible products-based businesses.

Known for their continued growth, dividend payouts, and risking profitability and sales, the old economy companies and their stocks are perfect for investors who wish to minimize their investment risk. Some popular old economy stocks have been listed below:

1. Reliance Industries:

Reliable Industries is one of the leading conglomerates that has established its business operations across various sectors like telecommunication, petrochemicals, retail, and even oil refining.

A wide customer base, strong business performance, years of infrastructure development, and professional management are some strengths that make Reliance Industries one of the best-performing companies and stocks from the old economy.

2. State Bank of India:

State Bank of India is the oldest and longest-running public bank in India. With countless branches and quality services, SBI has performed remarkably throughout its years of operations.

Moreover, it has maintained a strong footing against its competitors through professional management, strict loan disbursement policies, and quality asset management.

New economy stocks

With rapid digitization and the emergence of new service-based companies, the new economy is characterized by technology, software, quick commerce, digital payments, and other services that customers need.

Offering new intangible services, the new economy stocks offer a one-of-a-kind investment opportunity to investors.

However, such new economy companies may face certain setbacks like low profits and revenue during their initial years of operation. Some popular stocks are listed below:

1. Infosys:

Engaged in the development and distribution of software, IT technologies, AI and other cloud based services, Infosys is one of the most prestigious companies.

With an established customer base and continuous investment in research and development, Infosys has grown rapidly over its years of operation. Despite a downturn in the IT industry, the Infosys share price has maintained its solidarity through its operational strength.

2. Zomato:

Serving as a quick commerce and food delivery solutions providing company, Zomato serves as a company that caters to the new economy and its customers.

Through its quick food, groceries, and other delivery solutions, the company has grown by leaps and bounds serving customers all across India.

Moreover, the Zomato share price has increased by more than 66% in a single year delivering substantial returns to its investors.

While old economy stocks offer protection from any downturns, new economy stocks deliver an opportunity to generate considerable returns through investment.

A balanced investment into both old and new economy stocks offers stability and significant return earning opportunities crucial in the new era of technology and allied services.

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