BJP’s historic win in West Bengal has cheered investors and brokerages alike and triggered a stock rally, especially in tea stocks, in the state-headquartered companies. But escalating hostility in West Asia, a rising crude oil prices and concerns over foreign outflows made sure key benchmark indices namely Sensex and Nifty take a breather.
Shares of the West Bengal-based tea company, McLeod Russel India, continued to gain on Tuesday, rising 4 per cent to Rs 59-odd level, in addition to a 4.99 per cent rally in the previous session. Dhunseri Tea & Industries Ltd rallied 7.02 per cent to Rs 156.25 after rallying 9.32 per cent in the previous session.
Senco Gold climbed 3.24 per cent to Rs 346.15, a day after rising 7.09 per cent. Websol Energy System Ltd rose 3 per cent to Rs 119.67, in addition to a 5 per cent rise on Monday. Vikram Solar Ltd added 0.7 per cent after a similar upmove in the previous session.
Ifb Agro Industries Ltd, a manufacture of alcohol spirits and marine products, saw its shares rising 7.7 per cent to Rs 1,119.70, in addition to 20 per cent surge on Monday. These are all West Bengal-headquartered companies.
Several other stocks from West Bengal trimmed gains. RPSG Ventures, which rose 3.89 per cent in the previous session, trimmed gains as the stock fell 1.83 per cent to Rs 863.45 on Tuesday. CESC, another RP-Sanjiv Goenka Group (RPSG) group stock, fell 3.07 p cent to Rs 192.75 after rising 6.05 per cent in the previous session. Similar was the case with Bandhan Bank, which Monday’s 3.52 per cent cut gains by falling 0.92 per cent to Rs 204.85 on Tuesday.
Nomura India said the strengthening of BJP’s political foothold may reduce India’s political risk premium at the margin, especially amid the energy shock. “Markets are wary of the prospects of hikes in petrol and diesel prices now that the state elections are over. However, this is not a done deal yet, in our view,” it said.
The BSE Sensex was trading 516.27 points or 0.67 per cent, lower at 76,753.13. With this, the index wiped out the 355.90-point gains it made in the previous session. Nifty stood at 23,951.40, down 167.90 points or 0.70 per cent. It erased 121.75-point gains it made in the previous session.
Nomura said winning parties have committed to expensive freebies that could strain state fiscal finances. West Bengal, it said, may see improved governance and investment under BJP, and better centre-state coordination on various schemes, which could be a medium term growth tailwind.
MOFSL said once the election results are digested fully and their positive undercurrent well noted, markets will quickly shift focus to the more immediate developments in the West Asia war and the 4QFY26 earnings season. It noted that Q4 results season has been largely in line with estimates with a positive bias.
“In the short term, the market will remain hostage to volatile developments arising from the West Asian crisis, while higher commodity prices will be a key monitorable, as a prolonged elevated level could affect India’s macro parameters,” it said.
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