Since May 20 -- the day exit polls predicted majority for BJP-led National Democratic Alliance (NDA) -- the index has rallied 14 per cent, as compared to a 4.7 per cent rise in the benchmark index. On May 23, Narendra Modi
led-NDA recorded a landslide victory by securing 350 of 543 seats.
"The government/public sector has continued to drive capex
and capacity creation in the past few years. Early signs of uptick are now visible in the private sector, especially in hydrocarbon, steel, cement amongst others," analysts at Antique Stock Broking said.
While the uptick in sentiment could benefit companies like L&T, Siemens, ABB, CG Power, Honeywell Automation and BEML, possible trade war and project delays may alter the uptick in capex, the brokerage firm added.
Analysts at Elara Capital believe that order book for companies such as L&T, KEC International, ABB India, Siemens
and KEI Industries look visibly strong based on Q4FY19 results and supported by stable revenue expectation.
"Currently, order book mix largely comprises of government orders as private capex
is yet to pick up. However, within government, large orders are from the infrastructure sector covering roads, railways, and water but missing in the T&D sector. As capacity utilization level of manufacturing companies increase towards 80 per cent from the current 74-76 per cent, private capex
is expected to rise," it said.
Similarly, analysts at Reliance Securities
believe that L&T is well-placed to benefit from several big-ticket projects, as it satisfies all basic requirements including balance-sheet size, strong track record, technical expertise and adequate liquidity to bid for such projects.
It expects L&T to report strong order inflow over the next couple of years led by multiple high value orders including Bharatmala Pariyojana, SagarMala, bullet train and Metro rail.