In the three years since the Prime Minister Narendra Modi-led National Democratic Alliance (NDA) government came to power at the centre, Indian stock markets have been largely on an upward march, with benchmark indices Sensex and Nifty currently hovering around record highs. The government’s policy initiatives and the BJP’s win in the Uttar Pradesh elections have reinforced investors’ faith in the reforms process and triggered hopes for long-term political stability in the country.

How contribution of sectors to BSE’s market capitalization has changed

Market capitalization of companies listed on the BSE has grown to Rs127 trillion in three years, rising 59% from Rs80 trillion on 16 May 2014. The Sensex accounts for 40.4% of BSE’s total market cap. Its contribution has declined from 49.6% on 16 May 2014. The contribution of the BSE MidCap index has increased to 14.86% from 13.94% in the same period.

Most preferred Sensex stocks, then and now

Three years after the NDA government took charge, ITC Ltd, Power Grid Corp. of India Ltd, Sun Pharmaceutical Industries Ltd and ICICI Bank Ltd have retained their position in the list of 10 most preferred Sensex stocks by analysts. Banks seem to be in favour currently, with State Bank of India and HDFC Bank Ltd also in the list of preferred stocks, as analysts bet on an improvement in economic growth. There was no clear trend in preferences three years ago.

Top 10 gainers in three years of Modi government

The Sensex has gained 26.8% while the Nifty has surged 32% in the three years till 16 May 2017. In the same period, the BSE MidCap index has soared 94% while BSE SmallCap has risen 96%. Eleven stocks have gained 1,000-1,800%. Around 62 stocks have fallen 1-81% in the period, including heavyweights such as Tata Motors Ltd (down 1.74%), Tech Mahindra Ltd (2.6%), Punjab National Bank (4.84%) and Coal India Ltd (20.4%).