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Indiabulls Ventures: These 5 sectors will benefit the most from Modi's big win

Indiabulls Ventures: These 5 sectors will benefit the most from Modi's big win

Indiabulls Ventures: These 5 sectors will benefit the most from Modi's big win
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By Mousumi Paul  May 24, 2019 1:26:58 PM IST (Updated)

The clear electoral mandate given to the BJP and PM Modi in India's elections reduces political uncertainty and raises the potential for economic policy reform, according to experts.

With the ruling Bharatiya Janata Party (BJP) returning to power after a thumping victory in the recently concluded general elections, expectations are running high for the new government with regards to reforms and governance.

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The clear electoral mandate given to the BJP and PM Modi in India's elections reduces political uncertainty and raises the potential for economic policy reform, according to experts.
Indiabulls Ventures, in its research report, said that the BJP's new norms will help Nifty touch 13,000 mark by the end of FY20 as it expects overseas investors buying in domestic stocks to increase to Rs 1 lakh crore by end-CY19.
The brokerage expects the following sectors to benefit once Narendra Modi begins his second term, expected to happen by the end of May:
1. Banks-
Both private/public sector banks will benefit first. This will be on the back of interim budget Finance Minister Piyush Goyal's hint of 3 percent interest subvention if farmers pay their loans on time which will directly help the banks to collect most of the lent amount.
Top picks from this sector are SBI, Canara Bank, Indian Bank, Bank of Baroda, HDFC Bank, Kotak Mahindra Bank, Federal Bank and RBL Bank.
2. FMCG- Fast moving consumer goods have been facing headwinds on the consumption front from last few quarters. After the outcome of election results, expect consumption spending back on track on account of the stable government for more 5 years.
Top picks would be Hindustan Unilever, Britannia and Marico.
3. Infrastructure- Infrastructure or realty sector has always been one of the key sectors to benefit the most post positive election outcome. The brokerage believes Union Minister Nitin Gadkari will retain his infrastructure cabinet and speed up the pace of work both on land and waterways.
Top picks from this sector are KNR Construction and Ashoka Buildcon.
4. Cement- As infrastructure starts to pick its pace, the cement sector will follow it because the volumes will increase which will encourage companies to operate in optimum capacity.
Top cement picks are UltraTech Cement and Shree Cement.
5. Housing finance companies- This sector has been suffering since last yearover liquidity crisis. After BJP comes into power, PM Modi's dream of 'Housing for all' by 2022 will bring in substantial capital for HFCs to kickstart their lending services. Top picks are HDFC and CanFin Homes.
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