World’s best consumer finance firms to gain from India vote

Mumbai: Indians increase purchases of refrigerators and TV sets around election time as the government puts more money in the hands of voters, which stands to benefit some of the world’s most profitable consumer finance companies.

Prime Minister Narendra Modi is following his predecessor in boosting spending before polls due early 2019, a practice that has sparked surges in stocks of consumer finance firms. Bajaj Finance Ltd—with a world-beating return of about 70% over the past five years compared with 30% for Mastercard Inc. and 3.5% for Samsung Card Co.—saw its best performance during this period in the 2014 election year.

“Hope and euphoria” resonate through consumer habits during Indian elections, said Abhinav Angirish, managing director of Abchlor Investment Advisors Pvt., a Mumbai-based wealth management firm that has $417 million in assets. Rising consumer spends will boost consumer finance and other related stocks, he said.

Bajaj Auto Limited