India exchange traded funds of all shapes and sizes surged Monday as exit polls from the world’s largest democracy pointed to a landslide victory for Hindu nationalist Narendra Modi.

While Modi’s victory had arguably been previously priced in given the bullish year-to-date performances by India ETFs such as the WisdomTree India Earnings Fund (NYSEArca: EPI) and the iShares MSCI India ETF (NYSEArca: INDA), those ETFs still surged Monday. For example, EPI gained almost 4% on volume that was better than double the daily average, cementing its status as the best performer among the four major BRIC single-country ETFs. [Election Help for India ETFs]

Another India ETF that rallied Monday was the EGShares India Infrastructure Index Fund (NYSEArca: INNX), which gained almost 5% on volume that was nearly 10.5 times the daily average. There are visible signs that investors are betting a Modi victory combined with his UPA coalition’s ability to control a majority in India’s parliament will lead to increased infrastructure spending in a country that sorely needs it.

Over the past five days, INXX surged 7.6%. Among Indian alternative investment funds, those focused on infrastructure were among the top asset gatherers in the first quarter, reports Forbes.

A Jefferies analyst told Gulf News that India’s plans for so-called smart cities, if those plans come to fruition, could boost infrastructure spending 35% to 70% over the next thirty years with infrastructure, industrial, mining and cement equities among the beneficiaries.

INXX allocates a combined 56.5% of its weight to Indian industrial and basic materials stocks. A Modi victory has already proven to be a catalyst for INXX, but the real test for the ETF will come in the new leader’s ability to enact legitimate reform by convincing local governments to permit new infrastructure projects.

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