Top Stocks to Buy During General Election

The general elections in India are held every 5 years. As the election season approaches, the stock market is widely impacted by various political decisions and reforms laid out by the government. 

These policies and decisions, as a result, affect various sectors of the country resulting in a volatile stock market during the election season. However, this volatility in the market is also a great opportunity for investors to put their money into companies that are likely to experience growth. 

With The 2024 general election season in India just around the corner, let’s explore some stock picks that are likely to be influenced by the general elections and might experience a run-up in the coming days. Additionally, we’ll look at the top performing stocks during elections related to these sectors.

Top 4 Sectors & Their Stocks to Buy During General Election

Infrastructure and Development

Larsen & Toubro Limited
With India's infrastructure capital rising to Rs 11.1 trillion, Larsen and Toubro emerge as one of the most potential stocks to consider adding to your portfolio during the general elections. While the company has shown a decent run-up of around 23% in the past six months, it is likely to perform well with infrastructure requirements increasing in the country.

Although the stock price of L&T has recently faced a major hit of 9%, it remains among the election season stock picks with a long-term perspective to yield heavy returns. The stock is currently trading at a price of Rs 3,608 with a large market cap of 4.95L Cr.

Ashok Leyland
Another prominent competitor in the infrastructure industry, Ashok Leyland, is a stock that comes cheap and at a fair valuation. With almost all the major infrastructure projects being associated with Ashok Leyland, it can be a great choice to consider during the 2024 general elections. 

Currently, the stock is trading at a price of Rs 185 and has yielded a return of more than 10% in the past six months. As the government seeks to invest more money in the infrastructure domain, the company is expected to experience a major rise in the coming year after the 2024 general elections.

Ultratech Cement
Ultratech Cement has recently experienced slow growth in the stock market. However, if the current government is re-elected in the 2024 general elections, the stock can be a good consideration under the infrastructure domain. 

With a trusted company in the infrastructure domain, you can consider adding Ultratech Cement to your portfolio with a long-term vision. The stock is currently trading at Rs 9,700 on the stock market. However, it is likely to cross the Rs 10,000 mark and can be among the top gainers in the infrastructure sector.

Banking and Financials

HDFC Bank
HDFC Bank is the largest private sector bank in India. As the banking and financial sector rises in the country, HDFC Bank is likely to experience significant growth in the years to come. However, the 2024 general elections can be the best time to purchase the stock for several reasons.

The bank’s stock is currently trading at Rs 1,509, a significant decline from its 52-week high of Rs 1,757, making it available at a highly discounted rate. Despite this, the fundamentals of the company remain strong. Additionally, following the merger of parent HDFC Ltd. with HDFC Bank, the stock is yet to see a transformative journey that is expected to boost its price rapidly. 

State Bank of India
The State Bank of India is one of the largest banks in the country. With a market cap of Rs 7,15,218 Cr. With strong fundamentals of the company and a record of consistently increasing profits over the past few years, SBI can be a top consideration to add to your portfolio during the 2024 general elections.

The stock is currently trading at Rs 808 and if political stability is maintained during the elections, it is likely to experience significant growth post elections. 

ICICI Bank Ltd.
ICICI Bank has demonstrated resilience on the stock exchange for several years, making it a trusted stock to consider during the 2024 general elections. With the stock trading at Rs 1,107, and the bank’s profits constantly rising, it presents a prominent choice that could yield substantial returns in the upcoming years.

Renewable Energy & Power

Jindal South West (JSW) Energy Limited
In the renewable energy sector, Jindal South West Energy Limited, specifically associated with solar energy production, emerges as the prime choice to consider. As the government plans to invest more in the power and renewable energy sector through initiatives such as the  “PM Suryodaya Yojna”, stocks like JSW Energy could see significant growth.

JSW stock is currently trading at Rs 600 and has delivered an impressive return of 51% during the past 6 months.

Adani Green Energy Limited
Despite facing various obligations against the Adani group,  Adani Green Energy has shown remarkable performance. Moreover, with the likelihood of the current government being re-elected, the renewable energy sector is expected to see a surge in demand.

 Adani Green Energy, as a leader in this sector, stands out as one of the best stocks for the election period, having already provided investors with significant returns of around 97% in the past 6 months. 

National Thermal Power Corporation (NTPC) Limited
With a market cap of around 3.44 lakh crore, NTPC  can be another prominent choice to consider in the power sector. Moreover, with excessive energy requirements constantly rising in the country, the stock is all set to reach new heights during the 2024 elections.

Trading currently at Rs 357, the stock has already provided a return of 52% in the past six months and is likely to rise even further post-election. 

Tourism and Hospitality

Indian Railway Catering and Tourism Corporation Limited (IRCTC)
IRCTC can be one of the best stocks for the election period to include in of your portfolio. Since a major population in India will travel from cities to villages and vice versa during the election season to cast their votes, the railway sector is likely to experience a significant increase in activity. While the stock is currently trading at Rs 1,044, it has already recorded a 57% rise in the past 6 months, making it a compelling choice to consider during the 2024 general election
 

Summary of the Top 10 Stocks to Invest During Elections 2024

Conclusion

Patience is the key to making good returns from the market. As an investor, you can consider playing safer bets by building positions with a long-term perspective on these stocks. However, some stocks will likely show a run-up in a shorter duration.