Sectors to Watch if BJP Wins 2024 Lok Sabha Elections

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With the hype for the 2024 Lok Sabha Elections growing, investors are keeping a keen eye on the stock market. They're eager to spot opportunities that might arise from the political event on the horizon. While nobody can predict the future with certainty, some sectors seem worth watching, particularly if the BJP wins with a majority.

Come along with us as we explore the ins and outs of investing after the elections. We'll uncover the stocks that could be on the verge of gaining attention and possibly flourishing under a BJP-led government.

Top Sectors to Benefit from BJP Win 2024

1. Defence

India’s defence budget has been increasing of late. The interim union budget allocated over ₹6.21 lakh crore to the Ministry of Defence (MoD), 4.72% more than FY 2023-24. This figure will go higher if the BJP gets elected again.

Also, it is known that the government has been actively inviting foreign investments into the defence industry. There may be further collaborations with overseas companies and increased FDI in this sector under the BJP rule.

2. Railways

If the NDA government wins, a focus on modernising and expanding the railway infrastructure will gain further momentum. High-speed rail projects, station redevelopment, and increasing freight capacity would be prioritised.

The National Rail Plan 2030 aims to invest ₹50 lakh crore in the railways over the next decade. Increased investment in railway construction, technology, and services companies would enhance efficiency and connectivity. This could lead to revenue growth in the sector, benefiting companies involved in railway-related projects.

3. Oil and Gas

The BJP government has consistently promoted policies aimed at increasing domestic oil and gas production to reduce dependence on imports and enhance energy security. One key initiative, the Hydrocarbon Exploration and Licensing Policy (HELP), facilitates increased domestic production by granting exploration and production rights to private entities.

Additionally, the Pradhan Mantri Urja Ganga (PMUG) project seeks to integrate eastern India with the national gas grid. This ambitious initiative involves the construction of a 2,655 km pipeline to deliver natural gas to households, industries, and power plants. Further, it will significantly boost the operations and revenue of gas companies.

4. PSU Banks

The BJP government has been actively reforming PSU banks over the past years. Their efforts include recapitalization, improving governance, and enhancing digital banking infrastructure.

The re-election of the BJP could accelerate these reforms, leading to:

Improved asset quality: Addressing non-performing assets (NPAs) and strengthening balance sheets.

Better financial health: Enhanced capital adequacy ratios and profitability.

Increased lending capacity: Facilitating credit growth and supporting economic recovery.

5. Startups

The Indian startup ecosystem has experienced incredible growth since 2014. According to NASSCOM, Indian startups raised over $10 billion in funding in 2021 itself. Sectors like FinTech, HealthTech, and EdTech have attracted substantial investments.

The BJP government’s commitment to improving the ease of doing business can further benefit startups. Streamlined regulations, faster approvals, and reduced bureaucracy can create a favourable environment.

India’s ranking in the World Bank’s Ease of Doing Business Index improved from 142nd in 2014 to 63rd in 2019. According to the Inc42 Media report, India may witness the launch of around 180,000 startups, with over 280 unicorns and a combined valuation of $1.5 trillion by 2030.

This narrative paints a promising picture for the future of Indian startups if BJP wins.

6. Ethanol

Nitin Gadkari, the Union Minister of Road Transport & Highways, has been a strong advocate for promoting ethanol as an alternative fuel in India. He aims to achieve 20% ethanol blending by 2025, while E20 fuel is already available at over 3,300 fuel pumps across the country.

In August 2023, Nitin Gadkari also unveiled the world’s first-ever prototype of an ethanol-powered, hybrid (electrified) car based on the Toyota Innova MPV. Further, the Indian Oil Corporation has set up a plant capable of producing one lakh litres of ethanol per day, along with 150 tonnes of bio-bitumen daily.

Conclusion

As the anticipation mounts for the 2024 Lok Sabha Elections, investors are on the edge of their seats, eyeing the stock market for potential opportunities. From defence to railways, oil and gas to PSU banks, and startups to the ethanol sector, the landscape of potential investment avenues appears diverse and promising. Each sector holds its own set of opportunities, intricately woven with the policies and initiatives of the BJP-led government.

So, as we navigate the post-election investment terrain, let's keep a watchful eye on these sectors and companies for potential growth if the BJP wins.

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.

This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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Frequently Asked Questions

Which share will boom in 2024?

Answer Field

It is challenging to pick one stock that will boom in 2024. However, you can consider investing in different stocks from lucrative sectors such as defence, railway, oil and gas, ethanol, clean energy, tourism, etc. These sectors may also benefit if the BJP-led NDA government is re-elected on June 4, 2024.

Which sector is best to invest in 2024?

Answer Field

Determining the best sector to invest in depends on various factors such as economic conditions, technological advancements, regulatory environment, and global trends. However, if the BJP wins in June 2024, some sectors that could be promising for long-term investment include defence, technology, oil and gas, Indian railways, renewable energy, and PSU banks.

Which share is best for the next 5 years?

Answer Field

For long-term investment, you can look for companies with strong competitive positions, innovative products or services, and sustainable growth prospects. Blue-chip stocks from growing sectors are often considered suitable for long-term investment. Additionally, you must consider diversifying your portfolio to mitigate risk and capture more opportunities.

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