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Below the Quote on Daily Market Commentary by Mr. Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd

Domestic markets today cheered the exit poll results for Lok Sabha election, which predicts NDA to win for third consecutive time. Nifty opened gap up and touched new high of 23,338 levels, before closing the session near day’s high at 23263 levels with gains of 733 points (+3.3%). Even broader market rallied with Midcap100/Smallcap100 up 3.2%/2.4%. India VIX cooled down 15% to 20.94 levels and all sectors participated in the runup. PSU Banks, Infra, Realty, Energy and Oil & Gas rallied 5-8%. NDA 3.0 augurs well for the economy and capital markets as it provides stability and continuity in policy-making with a single-party majority government, which will be expected to continue pushing its economic growth agenda. Markets today heaved a sigh of relief, and after witnessing sharp volatility over last two months, it can now go back to fundamentals. Fundamentally, India is witnessing excellent macros with GDP growth of 8.2% in FY24, inflation at ~5%, fiscal deficits within tolerance band, stable currency, etc.. Even corporate earnings have been solid with Nifty ended FY24 with 25% earnings growth and FY25/26 earnings are likely to post 14-15% CAGR. We expect the market to reach new highs given the clear majority for the ruling party in exit polls, good macro trends, and solid corporate earnings. One can focus on manufacturing, capex, infrastructure and financials as theme for long term investment.

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