Mumbai: Shares of companies with significant business exposure to Uttar Pradesh lost value on Tuesday on account of profit booking, amid the state gearing up for a change in regime after assembly election results showed Samajwadi Party (SP) as a clear winner.
Shares of companies, perceived to have fared well in during the rule of Mayawati-led BSP in UP, fell on concerns that a change in the government could affect their business.
Analysts, however, expect the companies from sugar and power sectors to benefit from change of guard in the state. Profit booking during the later part of the day in an overall volatile market, however, saw sugar stocks ending with losses.
The market community largely expected Mulayam Singh Yadav-led SP to form a pro-business government in the state.
However, some analysts said that a weaker-than-expected performance from Congress in the elections could lead to some populist measures at the central government level and therefore slow the pace of economic reforms.
Jaiprakash group companies -- Jaiprakash Associates, Jaiprakash Power Ventures and Jaypee Infratech -- ended the day with losses up to 4% on the BSE.
Jaiprakash Power Ventures closed 4.12% lower at Rs39.55, while Jaiprakash Associates was down 1.07% at Rs69.60.
Similarly, Jaypee Infratech dropped by 2.06% to Rs42.85.
On the other hand, shares of Anil Ambani-led Reliance Group companies -- Reliance Power and Reliance Infrastructure -- slipped by 7.09% and 5.73%, respectively.
Other group companies also saw selling pressure. Reliance Broadcast Network ended 4.59% lower, Reliance Capital fell by 5.91%, Reliance Communications was down 5.23% and Reliance MediaWorks tanked 6.57%.
Meanwhile, in a highly volatile trade, the BSE benchmark Sensex closed 189.58 points lower at 17,173.29.