MOSL: Morning India (19/December/17)-1. India Politics; 2. Godrej Consumer Products (Corner Office); 3. Dish TV; 4. Metals Weekly

​MOrning India (19/December/17): 1. India Politics; 2. Godrej Consumer Products (Corner Office); 3. Dish TV; 4. Metals Weekly

Today’s top research theme

India Politics: BJP retains Gujarat; adds Himachal Pradesh to its kitty

• In the first major state elections post GST implementation, the BJP, the ruling party at the center, has won Gujarat for the sixth straight term and Himachal Pradesh (HP) state elections with a comfortable majority.
  
• Its vote share in Gujarat has gone up from 48.3% in 2012 to 49.1 % in 2017. In Himachal Pradesh, the BJP has won close to 2/3rd majority, while in Gujarat, it has won ~55% seats.
  
• Winning UP and Gujarat right after big structural reforms like demonetization and GST, which have created short-term disruption, reaffirms Mr Modi's popularity and augurs well from the reforms perspective, in our view.
  
• With the overhang behind, we expect the market to revert to fundamentals. 2HFY18 should see sharp earnings recovery, led by low base of demonetization and signs of pick-up in rural consumption even as the macros have come off a bit with the rise in crude oil prices, CPI inflation and 10-year bond yields.
  
• Top ideas: ICICIBC, SBIN, SHTF, REPCO, IGL, HMN, TTAN, MTCL, LT, BHARTI, and MM.
  

Piping hot news

Gujarat election results: BJP’s urban surge offsets Congress’s gains in rural areas

• The Bharatiya Janata Party’s (BJP’s) scratchy win in Gujarat has much to do with its dominance in the urban parts of the state. The results suggest the BJP has improved upon its 2012 performance in central Gujarat, which largely accounts for the urban constituencies. On the contrary, a majority of the gains the Congress has made seem to be coming from the rural parts.