Thoughts on UP state elections

Samajwadi and Congress might form govt in UP. Based on poor performance of BMW so far - firing ministers has only confirmed that they were corrupt. Extreme stupidity. Minority reservation should pay rich dividends for Congress. Ajit Sigh might perform very well in Western UP, Congress and SP might have informal seat sharing and increase muslim vote share. BMW will lose muslim and brahmin votes - congress will get brahmin votes. SP plus Ajit plus Congress is a winning combination. BJP will be wiped out in UP (also in Uttarakhand and Punjab). Mayawati seems to have blundered and her game plan has boomeranged. UP everything is caste. Muslim - Yadav - Brahmin - Jat combination for SP+Congress+RLD will definitely win the election. This is already seen on the ground gossip. With splitting of remainder of votes - BJP getting Thakur/Bania and BSP getting Dalit votes and the rest evenly divided, there is little chance of BSP returning.

Her firing of ministers has only confirmed her corruption - it shows her in bad rather than good light. Her statehood division is seen as a ploy which fell flat after initially trumping the congress. Rahul efforts are largely seen to be bearing fruit.

Basically, the new combination is becoming the wisdom on the ground and is commonly acknowledged. This prediction is nothing new - many have already done so and is commomplace now.

Farmers of Bulandshahar and NOIDA are essentially not happy and will go with Congress/RLD combine. This was supposed to be the big benefit for BMW which has failed to materialise.

A lost election spells big trouble for BMW. CBI disproportionate asset case will be active again. New cases will be filed. Many big developers like JP, 3C, Wave, NRI etc will be troubled with new bribes needed = big losses.

Rapproachment between Mukesh (congress) and Anil (SP) Ambani is also acknowledgement of shifting in power equations in politics. Mukesh was being hounded for bribes by Congress and if SP winds, the two brothers will emerge again as kingmakers (after Mukesh was in minor difficulties)

It may cause project abandonment in NOIDA and GNOIDA area in 2012. Until election results, one should stay away from NOIDA RE. One should also avoid JP and JP infra stocks

What does the UP/NOIDA Janta here feel on this?

(Later)Lots of great insight from all of you here. SOme of the points which I had not considered:

1. Companies have already set aside money for bribing new govt: probably true. But companies which are too closely associated with BMW regime might have problems just to prove the point that politicians are the bosses - so they might trouble JP just to send a message - JP will be screwed if BMW loses - or the payment will be much more than for other players. But please note - JP is a old and Sen-s-ex listed company unlike Sahara which is a front for ganster money. Also, JP survived under congress 30 years ago - will survive with heavy bleeding. Paras, NRI, Wave etc are just BMW front companies and will probably take the investors money and vanish - truly avoidable.

2. Many people feel that BJP and BSP might have coalition. But will BJP have any significant numbers? Their non-yadav OBC vote bank is being actively poached by congress and BSP - we have to see what happens. Brahmins, Bania and Thakurs may or may not vote for them - they might just vote for the caste and in their areas, all parties will have same caste contender - they might vote for the person and not party. YOu need over 50 seats to be able to support a govt - otherwise people will just defect. BJP is in make or break situation.

3. Gorakhpur situation was well pointed out - same with Jhansi - Bundelkhand and Purvanchal regions might respond to the state split proposal of BSP - they might be a big surprise win for BSP. Again, we need to see.

4. Yadav plus muslim is alone enough to defeat BSP - as in past. Tactical co-operation between congress and SP can really get them a land slide - probably it wont come about (politicians are so stupid) - adding congress MBC and non yadav OBC and some of the brahmin/bania/thakur votes to SP would get them land slide. Without poaching each others votes

5. Congress and BSP cannot have pre-poll alliance - they try for the same votes and can only compete and go for post poll alliance.

6. Anna is irrelevant. He should not waste his time in UP - he should be in Punjab and Uttaranchal where his anti congress message can help BJP re-election

7. Early lok sabha polls - no chance. Congress is not stupid like BJP - only BJP was stupid enough to dissolve early and lose power a year before they had to. COngress will never make the mistake. If congress had faced the 1999 confidence poll where Saifuddin Soz brought down govt with one vote - their speaker would have cast 2 votes and made the govt survive. BJP was stupid enough to have a speaker who did not vote at all - morons.

8. A lot also depends on turnout - lower the turn out, better for BSP (whose people will turn out). Yadav and muslim will also turn out - but a lot of MBC, non yadav OBC and brahmin/bania/thakur might not turn out at all. Bad for congress and BJP. With 40% turn out, BSP win is certain, with 60% turn out SP/Congress win is certain, at 50% turn out, its anybodies guess. Especially western UP and Awadh turn outs.

9. Positioning for real estate: avoid fresh exposure till elections are over. But expect a big boost in flat prices of around 30% after elections - so hold positions. If BSP wins, expect a boost in JP projects. Other BSP front projects can heave a sigh of relief. If SP wins, front companies will delay project for 5 years. This will reduce supply. All others will have to raise prices for the fresh bribes - so expect prices to jump by 30% across the board. Added to all the other congress related measures, strong prices in NOIDA for the remainder of the congress term till 2014 is inevitable. Expressway projects are the best bet right now.

10. For stocks, JP stocks are the best bet - they are already hammered with limited downside. If BSP wins, expect a 100% return within 3 months. Especially JP infra. In general, regardless of results, if COngress is involved in UP govt, expect a big stock and real estate boost. Expect a lot of fireworks in budget also - all in all, from now to March, best time to enter stocks.



All in all, it seems like a close race for BSP and SP - overall, I am hearing that law and order was little better under BMW and statehood might strike a cord in some parts of UP - if they work, BSP might win (30% chance). Otherwise SP (70% chance)