Indicators suggesting the BJP-led ‘Mahayuti’ alliance is set to win a landslide majority caused Indian benchmark indexes to open lower Thursday following the Maharashtra election exit polls. However, in early trading, shares of the Adani Group, which is led by Gautam Adani, fell by as much as 18%.
The opposition Maha Vikas Aghadi (MVA) is presenting a serious threat in the state’s assembly elections, but the ruling Mahayuti alliance is expected to hold onto power in Maharashtra, according to the most recent exit poll data. A majority for the Mahayuti alliance was projected by a number of exit polls that were made public on Wednesday following the conclusion of voting for the 288 seats.
The markets, which have been poor lately as a result of frequent selling by Foreign Institutional Investors (FIIs), shouldn’t be significantly impacted by the Maharashtra election. We don’t anticipate any major corrections or reactions (either way) on results day, regardless of the outcome. Manish Jain, Chief Investment Officer at Centrum PMS, advised investors to take advantage of this chance to purchase stocks of reputable companies.
In the Maharashtra elections, he noted, a fierce battle between the opposition Maha Vikas Aghadi (MVA) and the ruling Mahayuti alliance is anticipated. Maharashtra is the second-largest state in terms of the number of seats it contributes to the centre, according to a recent note from analysts at Macquarie. Given this, Narendra Modi would benefit politically from a successful conclusion for the BJP-led Mahayuti alliance since it would increase his authority.
According to analysts, the market will be keenly monitoring any policy pronouncements made by the new administration that can affect the operations of Maharashtra-based businesses.
An MVA-led government may prioritise fewer infrastructure projects than the MYA (BJP-led alliance), which worries some investors. In a recent statement, Suresh Ganapathy, Aditya Suresh, and Puneet Bahlani from Macquarie stated, “Therefore, we think it is essential to closely monitor some of the major planned projects in the state and the implications for the companies involved in executing those projects.”
With 48 members, Maharashtra is the second-largest state in the Lok Sabha. It has a per capita income that is 30% greater than the national average and accounts for the highest part of India’s GDP, 13–14%, according to Macquarie’s estimations. Foreign brokerages estimate that Maharashtra accounts for 16% of India’s overall exports and has the largest percentage of government-recognized startups in the nation (19%).
Although the Maharashtra elections are a big event for the stock market, analysts say they don’t have the only influence on how the market performs. Other important determinants are firm earnings, investor mood, geopolitical conditions, and the state of the global economy.
Disclaimer: This article’s content is sourced from broking houses and investment specialists; it does not reflect the opinions of Kadam Buzz. A competent expert must be consulted before making any decisions pertaining to investments.
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