Indian stock markets witnessed a robust rally on November 25, with both the Sensex and Nifty 50 gaining over 1% each, driven by a surge in investor confidence following the decisive victory of the BJP and its allies in the Maharashtra state elections. This development lifted the overall market sentiment, adding a staggering ₹7 lakh crore to the BSE-listed firms’ market capitalization, which now stands at ₹440 lakh crore, up from ₹433 lakh crore the previous day.

Key Indices Performance

The Nifty 50 climbed by 1.32%, closing at 24,221 points, while the Sensex rose 1.25%, ending the session at 80,109 points. The rally extended to broader markets as well, with the Nifty Midcap 100 and Nifty Smallcap 100 indices posting gains of 1.61% and 2.03%, respectively.

Sectoral indices were also buoyant, led by the Nifty PSU Bank index, which surged by 4.09%, reflecting optimism around increased capital expenditure (capex) expectations. Other indices such as Nifty Oil & Gas, Nifty Infra, and Bank Nifty recorded gains between 1.71% and 3%.

Top Gainers

Among individual stocks, Oil and Natural Gas Corporation (ONGC) emerged as the top gainer, rising 5.1%, followed by companies like Bharat Electronics, L&T, SBI, and Apollo Hospitals, which registered significant gains. Out of the 50 constituents of the Nifty 50, 42 stocks closed in the green, signaling broad-based buying interest.

Election Impact on Markets

The BJP's victory in Maharashtra is seen as a harbinger of policy continuity and an anticipated ramp-up in government spending. Analysts project a shift in focus towards capex growth, which has lagged behind FY2025 budget estimates. This is critical, especially as government spending in the first half of FY2025 has remained flat, with capex spending down by 17% year-on-year.

Recent Market Corrections and Valuation Opportunities

The markets had been under pressure for the past two months, with the Nifty 50 and midcap indices correcting by approximately 9% due to weak corporate earnings, FPI outflows, and geopolitical concerns. However, analysts now see a window of opportunity, especially in large-cap stocks, where valuations have become attractive at 19.3x FY26E EPS. Midcaps and smallcaps, however, remain relatively expensive.

Future Outlook

Looking ahead, analysts expect demand recovery to pick up in H2FY25, driven by:

• A robust monsoon season and strong Kharif output.
• The ongoing wedding season, which is seeing a 30% YoY increase in activity.
• Improved rural spending on the back of stable macroeconomic conditions.

While near-term risks persist, including global geopolitical volatility and dollar index movements, the Indian markets appear poised for a mini risk-on rally, especially in sectors like BFSI, capital goods, real estate, IT, and healthcare.

The Upcoming IPOs in this week and coming weeks are Rajputana Biodiesel, Apex Ecotech, Abha Power and Steel, Agarwal Toughened, Ganesh Infraworld, Rosmerta Digital, Avanse Financial and Nisus Finance.
The Current active IPO is Rajesh Power Services, C2C Advanced System, Enviro Infra Engineers and Lomosaic India.

For more insights into financial trends , visit our Top News Headlines. You can also explore investment opportunities in the market and apply for upcoming IPOs through our Best IPO to Apply Now section.