India equities post-election outlook

India equities' post-election outlook
Key takeaways

India’s BJP-NDA alliance wins a third time in government, with a narrower than expected victory. 


The government is committed to attracting investments and promoting domestic manufacturing.


India’s financial transformation is presenting significant growth opportunities for the country.  

India's 2024 Elections: investment implications after BJP's narrow win

India's 2024 general elections concluded on June 4. Narendra Modi's Bharatiya Janata Party (BJP) won only 240 seats in the general elections, which was lower than its performance in 2019 and less than market expectations.

The National Democratic Alliance (NDA) - the political alliance led by the BJP - won a majority by securing 290 seats, surpassing the halfway mark of 272.1

While BJP-NDA alliance is set to form the government for the third time, the margin of victory is narrower than expected.2

The Indian market was volatile post-election. The Nifty 50 and SENSEX dropped more than -5%3 after the results, however, rebounded by +3%4 the following day. 

While the victory of Modi is narrower than expected, their ruling party is still in majority, therefore we believe the ongoing reform and policies shall continue.

We anticipate policy continuity in India, as evidenced by the Prime Minister's post-election speech. The speech reaffirmed the government's commitment to support the electronic manufacturing, semiconductor, defence, green energy, EV, and digitisation sectors, coupled with efforts to make India the third-largest economy in the world.

Fundamentally, India remains in good shape, with positive high frequency data and an estimated GDP growth of 8.2% for 2024.5

We believe it is crucial to continue focusing on our bottom-up, fundamentally-driven stock selection approach, as this is much more important in the current market environment. We see multi-year secular growth in these investment themes. 

Consumption explosion: domestic oriented sectors to benefit

We are witnessing an inflection point for discretionary consumption in India, as the middle class expands and their purchasing power increases. This shift towards discretionary spending is expected to drive sustained growth in various sectors.

We believe India is poised for a consumption explosion, supported by a rising population and growing GDP per capita. Domestic-oriented sectors like transportation, hotels, jewellery, and automotive are expected to benefit from the rising incomes of Indian consumers.

Manufacturing renaissance: government initiatives and global partnerships

The government's commitment to attracting investments and promoting domestic manufacturing, exemplified by initiatives like Make in India and Production-linked Incentives schemes, further solidifies the positive outlook for India's manufacturing sector.

India has successfully cultivated a manufacturing renaissance, positioning itself as a key global partner and benefiting from worldwide supply chain relocation. Global dynamics have encouraged multinational companies to expand production and establish factories within India, further bolstering the country's manufacturing capabilities.

A look into India’s digital financial transformation

India’s financial transformation, fuelled by increasing digitalisation, presents significant growth opportunities for the country.

As more individuals gain access to digital services and financial inclusion expands, it paves the way for enhanced economic participation and consumption, further boosting India's overall growth trajectory.

The rise of e-payment systems, retail credit, and global business services hubs has been tangible manifestations of this financial transformation. We believe the continued advancement of India's digital financial infrastructure will pave the way for even greater growth within the financial services industry.


  • Bloomberg, 5th June 2024

    Economic Times, 4th June 2024

    Bloomberg, 4th June 2024

    Bloomberg, 5th June 2024

    Reuters, 31st May 2024

Investment risks

  • The value of investments and any income will fluctuate (this may partly be the result of exchange-rate fluctuations) and investors may not get back the full amount invested.

Important information

  • All data as of June 7th, 2024, unless otherwise stated.

    This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.

    Views and opinions are based on current market conditions and are subject to change.