After the bumper voting in the Bihar elections 2025, all eyes are on the outcome, the impact of which could potentially affect the NDA government at the Centre. NDA’s loss in the Bihar elections could trigger a realignment at the Centre, which may cause stock market volatility, bring the benchmark Nifty 50 down by 5-7 per cent, according to brokerage firm Incred Equities.
Bihar Assembly Election 2025 recorded a 66.91 per cent voter turnout, the highest ever in the state since 1951, according to the (ECI). The second and final phase of the election saw voter turnout of 68.88 per cent, higher than the 65.09 per cent in the first phase.
Meanwhile, indicate the NDA may retain power in Bihar. However, exit polls have been inaccurate on many occasions in the past. The final outcome, due on November 14, may be opposite to the exit poll predictions.
Bihar poll outcome: Impact could stretch beyond the state
According to Incred Research (Incred Equities), if the NDA loses the Bihar elections, the fallout could potentially pave the way for a coalition-led realignment at the Centre.
InCred’s analysis says Nitish Kumar, long aspiring for national relevance, may seize the opportunity to accept a prime minister’s role within an INDI bloc, possibly under a rotational power-sharing arrangement (2.5 years each) with regional leaders like Chandrababu Naidu.
“Anticipating such a move, the BJP has already activated Plan B — a containment strategy to split JD(U) through loyalists like Lalan Singh and prevent any defection. This scenario would introduce short-term policy uncertainty and market volatility, as investors reassess fiscal and reform stability in a fragmented coalition set-up,” says InCred.
“Bihar’s poll verdict could mark not just a regional upset but a political turning point for India, reshaping both power equations in Delhi and investor confidence in policy continuity.”
Markets may see high volatility
According to InCred, if the NDA were to lose Bihar and the ripple effect extended to the Centre, leading to an INDIA coalition government under leaders such as Nitish Kumar or Chandrababu Naidu, markets would likely experience a sharp, short-term risk-off phase driven by political uncertainty. Defence, infrastructure, and PSU themes may lose momentum, while consumption, regional, and SME-linked equities could benefit from a decentralised fiscal orientation.
“History shows that when dominant-party stability gives way to coalition ambiguity—as in the 2024 post-poll reaction, when the Nifty 50 index fell 6 per cent in a single day—investors immediately price in concerns over policy continuity, fiscal prudence, and reform momentum,” InCred underscores.
The brokerage firm expects near-term volatility across indices, outflows from foreign investors, and a temporary repricing of India’s “stability premium.
“A post-NDA coalition may unsettle sentiment in the short run—but the long-term trajectory will depend less on who governs and more on how decisively the new leadership manages continuity in reforms and credibility in fiscal management,” said InCred.
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