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Indian companies get a lot less publicity than their Chinese equivalents, despite many of them operating under much more stringent oversight and regulatory structures, better rates of return, and roughly the same sized national market. They deserve to be treated better. Here are three Indian large caps that you should be considering.

HDFC Bank (HDB)

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HDB Bank is an India-based bank, with various subsidiaries, that provides retail, wholesale, banking, and treasury banking services to both commercial and individual customers. It has a market cap of over $30 billion and over 789 million shares outstanding. Its revenues have grown from $3.7 billion (in U.S. dollars) in 2009 to $6.5 billion in 2012. Its profit margins have similarly improved, going from 8% in 2009 to 15% in 2012. It also provides an annual dividend, since 2002, ranging from $0.15/share to $1.11/share; 15% of all shares are owned by institutional investors.

Investors have responded to this over the past year, and the stock price has risen 12% since February 2012. There's no particular reason to expect a rapid decline in price; short investors certainly don't, as there are only 2.5 million shorts out of 785 million shares outstanding. The cost of revenue has crept up over the past few years, but at a pace largely outstripped by overall revenue and profit growth. There is no long-term debt to speak off. This is definitely a stock worth researching if you're looking for a India-based bank to invest into.

ICICI Bank (IBN)

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IBN is another India-based bank, with similar reports of growth over the past few years. This bank has a yield slightly better than HDB, although its price hasn't grown as much over the past year. Nor has its overall revenues, which are down from the end of March in 2008 through to today, although the revenues have been creeping up for the past year or so.

It has a market cap of $24.7 billion with 576 million shares outstanding. IBN had the largest number of branches of any private bank in India at the end of 2012 with 2,895 branches. It also has 10,040 ATMs, up from 7,602 ATMs at the end of 2011. IBN could be considered for inclusion in a portfolio based upon the scale of its operations, and the growth of that scale, alone. It is using this scale to leverage increased profits, which grew 22% for 3Q2013 compared with 3Q2012. At the current pace of revenue growth, it should surpass where it was in 2008 by the end of the calendar year.

As a little added sweetener, IBN does pay out an annual dividend, usually but not always in late May or early June, typically at around a 1.5-2% yield for the stock price at the time of record.

Cognizant Technology Solutions Group (CTSH)

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Cognizant Technology is an Indian customer information company, related to the tech industry, and provides business outsourcing services. It has a $23 billion market cap and 300 million shares outstanding. The price has gone up the least out of the companies in this profile, going up "only" 5% in the past year. CTSH does not pay out a dividend.

This increase in price is likely undervaluing the company's performance in the past year as well. Its revenues for the full year increased 20% from 2011 through 2012, up to $7.35 billion. Strategic clients for Cognizant increased from 23 to 214. In the last earnings call, management forecast it would bring in $8.6 billion in revenue in 2013.

Some of the challenges for Cognizant include dealing with healthcare reform, as it relates to providing services and advice for clients. Management states that it is not particularly concerned about competition. It is concerned about the pharmaceutical industry and its clients, predicting that 2013 will be a rough year for them, although things look better for 2014 and 2015.

Bottom Line

All three companies are ones that have grown or rebounded over the past few years. There are no particularly strong reasons to expect any of these three companies to slow down. While challenges do exist, that's true of most things in life. Millions upon millions of Indians need retail banking services. American and European companies are not seeing a need to slow down any outsourcing services. A well-diversified portfolio should include a foreign stock or three, and these three would go well for any investors who do their homework to see if one is right for them.

Source: 3 Indian Large Caps Growing Leaps And Bounds