According to multiple opinion surveys referenced by Motilal Oswal Securities in its most recent strategy paper, the BJP may hold onto power for a third consecutive term with a complete majority. According to Motilal Oswal, Prime Minister Narendra Modi's unveiling of the BJP's Sankalpa Patra (Manifesto), dubbed "Modi ki Guarantee 2024," shows the government's confidence in regaining power by forgoing any significant giveaways that would have come at a financial expense.
India, as stated, is in a mini-Goldilocks scenario because of strong macroeconomic factors (GDP, inflation, CAD, stable currency) and robust microeconomic factors (corporate earnings). In addition, the local brokerage stated that the prospects for political continuity under PM Modi and an acceleration of policy momentum (as promised in the BJP manifesto) in the BJP's prospective third term bode favorably for the short- to medium-term stock markets.
At the moment, the Nifty is trading comfortably within its 20-time FY25E EPS long-period average PE. In contrast to its underweight position in IT, Motilal Oswal reported that it remained "overweight" in domestic cyclicals such as BFSI, industrials, real estate, and consumer discretionary. It also maintained an equal weight in healthcare, automobiles, metals, oil and gas, and telecom.
ICICI Bank Ltd., State Bank of India (SBI), Larsen & Toubro (L&T), Titan Company Ltd., ITC Ltd., HCL Technologies Ltd., Coal India Ltd., Mahindra & Mahindra (M&M), Zomato Ltd., and Hindalco Industries Ltd. are among the large-cap stocks that Motilal Oswal likes.
Mid-cap stocks that are of interest include Sobha Ltd., Lemon Tree Hotel Ltd., KEI Industries Ltd., Global Health Ltd., PNB Housing, KOEL, Cello World, Indian Hotels Ltd., and JK Cement Ltd.
In its 2024 manifesto, the Modi-led BJP emphasized some big-ticket political initiatives like the Uniform Civil Code, the Implementation of Citizenship Amendment Act, and One Nation, One Election, along with maintaining policy continuity, improving execution, and expanding the scope of current priorities (housing, Ayushman Bharat, physical and digital infrastructure).
The manifesto emphasizes widespread development through a range of policies and actions from the government that will
possess socioeconomic effects. The expansion of manufacturing (establishing India as a global manufacturing hub), infrastructure (roads, railways, airports, metros, inland waterways, and shipping), and capital expenditures will continue to be the top priority. In terms of social policies, the BJP intends to extend the reach of Ayushman Bharat to include older persons, quadruple the ceiling of Mudra loans to INR2m, and maintain free rationing under PMGKAY for the next five years, according to Motilal Oswal.
The "Neo Middle Class" group is also mentioned in the manifesto, and it places a strong emphasis on giving them access to high-quality healthcare and education in addition to realizing their ambition of house ownership.
Strengthening digital and physical infrastructure, empowering MSMEs, and positioning India as a major manufacturing hub for electronics, defense, aviation, railways, and renewable energy are some of the major economic ideas. Another aim, according to Motilal Oswal, is to connect all major cities and towns to piped natural gas.
