Modi Stocks Surge as BJP Eyes Hattrick in Haryana Elections: Adani, PSU Shares Lead the Rally

Modi stocks, which are shares related to the government’s spending on infrastructure projects, saw a strong bounce on Tuesday, rising by up to 8%. This rally followed the BJP’s expected victory in the Haryana elections, marking a hat-trick win for the party. Investors were encouraged by the BJP’s performance, with the market reacting positively as it suggested the government’s economic policies would continue.

Stocks of Public Sector Undertakings (PSUs), particularly in the railway and defence sectors, were among the top gainers. Railway stock RVNL rose by more than 8%, HUDCO jumped 7%, and other PSU stocks like PFC, REC, IRCON, HAL, BEL, Mazagon Dock, and Cochin Shipyard saw gains of 4-6%.

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Shares of Adani Group companies, many linked to infrastructure projects, also surged. Adani Transmission led with a 7% rise, while Adani Ports rose 5%, and Adani Enterprises was up 4%.

Sunny Agrawal, Head of Fundamental Equity Research at SBI Securities, said, “The Haryana election result is better than the market expected. It eases fears that the government would turn more populist. This is why PSU stocks, which depend on government orders, are rallying.”

The election outcome also had a positive effect on the broader market, with the Sensex breaking a six-day losing streak, gaining up to 700 points. The Nifty index rose 1%, regaining the 25,000 mark.

VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted, “The BJP’s win in Haryana is a boost for the party after a mild setback in the national elections. This victory shows that farmers still support the ruling government, which could help revive the farm reforms that were stalled due to protests.”

BJP has long been favoured by investors due to its stable, pro-business leadership. Jathin Kaithavalappil, AVP at Choice Broking, warned, however, that while this election result might stabilize markets in the short term, global geopolitical factors could continue to impact the market in the long run.