NDA Win In Maharashtra To Boost Risk-On Sentiment, Say Brokerages

The National Democratic Alliance's win in Maharashtra — one of the key economic and industrial state in the country — is expected to ease worries over political instability on a national level, subsequently boosting risk–on sentiment among market participants, according to brokerages.

The NDA won 235 seats out of 288 seats in the Maharashtra assembly. Of this, the Bharatiya Janata Party secured 135 seats.

The BJP's win in Maharashtra election will ignite a mini risk–on rally, as concerns over political instability wane, according to Motilal Oswal Financial Services Ltd.

BJP's majority will lend political stability to western state, which grappled with uncertainty in last five years due to shifting alliances and local party breakups, Jefferies said. Moreover, the comfortable majority in Maharashtra reversed the losses which BJP saw in 2024 national election. Its victory is followed by similar improvement in Haryana.

Direction toward populism is maintained, Jefferies said observing a rise in populist schemes at the state level by both the BJP and Congress–led government. BJP manifesto promises to raise the income to transfer to Rs 2,100 per month. Other such populist schemes are cooking gas scheme, free electricity and 2–5 times jump in health insurance.

BJP's notable success in Maharashtra election was due to the announcement of direct income transfer scheme for women, according to Antique Stock Broking.

Consumption is expected to increase moving forward, because of the populist schemes, Jefferies said. "We estimate that 0.7-0.8% of GDP is being spent on an annualised basis on such schemes, covering 12 crore households. Notably, the most populous and poorer states of Uttar Pradesh and Bihar are yet to launch such schemes."

Central government's spending is estimated to increase by 15% and capital expenditure to rise by 25% in the second half. In 2025, the election calendar looks 'benign', according to Jefferies.

The recent correction in the Indian markets has provided a good opportunity to accumulate stocks within investment linked themes, Antique Broking said. This is because of the receding political risk, minimal scope of an earnings downgrade in second half of the fiscal, reasonable valuation, and global macro uncertainties largely priced in, the brokerage said.