Riken Mehta
Moneycontrol.com
Follow me on Twitter @mehtariken
In 2008, when Delhi, Rajasthan, Chhattisgarh, Madhya Pradesh and Mizoram held assembly elections, the results were declared on December 7, a Sunday. On that occasion, the market was hoping for a 4-1 score line in favour of the Congress, since the consensus view was that a poor showing in state polls would hold the UPA government from pursuing further reforms. Eventually, Congress won in three out of five states, losing Madhya Pradesh, as expected, and Chhattisgarh, in a closely fought battle. The following day, the Nifty and Sensex surged over 2 percent.
But the upbeat mood on the bourses were not the derivative of election results alone. On the same day as the poll verdict, the government announced a fiscal stimulus package to revive India’s economy, which was feeling the aftershocks of the global financial crisis. In the next trading session (December 9 was a public holiday), indices climbed another 5 percent.
| Indices | 8-Dec-08 | 10-Dec-08 |
| Nifty | 2.58% | 5.17% |
| Sensex | 2.20% | 5.38% |
| Bank Nifty | 1.68% | 2.71% |
| FIIs (Buy) |
Rs 460 cr
|
Rs 988 cr
|
| Rupee | 49.22 | 49.12 |
Difference between 2008 and
now
Nifty
made a low of 2502 on November 20, 2008 few days prior to state election
results. In 2013, Nifty is trading close to its all-time high. After state
election results in 2008, Nifty has never revisited lows of 2502 so far.
In
2008, developing economies like US and UK were in a sub-prime mess whereas in
2013, they are leading the way. Positive global cues in 2013 compared to 2008.
India's
Q2 GDP in 2008 was 7.6% whereas in 2013, Q2 GDP is 4.8%. Domestic consumption
story has slowed down.
In
2008, Congress won three out of five states and came into power with majority.
In 2013, will it be BJP?
In
2008, rupee was around 49 mark, In 2013 rupee is around 62.
2008
poll results
| States | Congress | BJP | Others | Total |
| Madhya Pradesh | 71 | 143 | 16 | 230 |
| Delhi | 43 | 23 | 4 | 70 |
| Rajasthan | 96 | 78 | 26 | 200 |
| Chhatisgarh | 38 | 50 | 2 | 90 |
| Mizoram | 32 | MNF 3 | 5 | 40 |
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