The S&P BSE Sensex rallied over 950 points to hit 40,000 and the Nifty50 broke above its previous record high of 11,883 to touch a record high of 12,000 as early trends indicate a majority for the NDA.

Early trends put NDA in a comfortable position to form the government that has, to an extent, already been factored by the market after exit polls.

The second term for the Modi-led government would guarantee continuity of the reform process and the uncertainty around the political front has now come to rest which is a positive sign.

"The elections posed an event risk, and if results do turn out to be as expected, we expect a broad-based rally in the markets over the coming days which may result in new highs, after which the market may take a breather," said Vivek Ranjan Misra, Head of Fundamental Research at Karvy Stock Broking.

"We expect that after one to two quarters there should be a resumption of a rally in markets as the economy and corporate earnings improve. We expect the market to end the year higher with the Nifty in the range 13,000-15,000," he said.

Investors are advised to stay with quality names in sectors which are likely to hog the limelight in the near future. Investors can hold on to select private banking names, followed by consumption, OMC and IT.

The S&P BSE Banking Index rallied 94 percent followed by IT, which gained 78 percent, and FMCG, which rose 73 percent, during the last five years of the Modi government between May 26, 2014 and May 21, 2019.

"Domestic consumption will remain the cornerstone of investments in Indian Markets. Consumption, select financials, oil marketing companies, and niche engineering companies remain the best bet in the market," Sandip Raichura, CEO Retail, and Distribution, Prabhudas Lilladher, told Moneycontrol.

Here are 13 fundamentally strong stocks from various experts with a holding period of more than one year:

Analyst: Rusmik Oza, Head of Fundamental Research, Kotak Securities Ltd.

Mahindra & Mahindra:

New launches in the UV segment will drive volume growth in the passenger car segment. We value M&M at Rs 1,000/share out of which Rs 319 is derived value of subsidiaries.

State Bank of India:

With negligible balance sheet risk, we believe that the bank is well-positioned to deliver strong earnings growth for FY2020-21, which could see RoAs moving closer to 1 percent.

We maintain a buy rating on SBI with a fair value of Rs 410, valuing the bank at a 1.2x book and 7x March 2021E EPS for RoEs in the range of 15 percent in the medium term.

Colgate Palmolive:

We expect revenue acceleration in the next couple of years led by market share gains and revival of premiumization trend in the category. Earnings are likely to grow at a CAGR of 15-16 percent in the next two years. DCF based fair value works to Rs 1,400/share.

Power Grid:

Power Grid has been able to fend off the competition on the back of lower cost of capital, as well as capex cost. Existing projects under various stages of implementation assure earnings growth of 14 percent CAGR up to FY22E. Power Grid trades at attractive valuations (9x Fw PE).

Analyst: Amar Singh, Head Advisory, Angel Broking Ltd

HDFC Bank:

We expect company’s loan growth to remain 22 percent over the next two years and earnings growth to be more than 21 percent.

RBL Bank:

The stock currently trades at 2.9x its FY2021E price to book value, which we believe is reasonable for a bank in a high-growth phase with stable asset quality.

Bata India:

We expect Bata India to report net revenue CAGR of ~16 percent to Rs 3,497 crore over FY2018-20E mainly due to increasing brand consciousness amongst Indian consumers.

Maruti Suzuki:

Due to the favourable business mix, together with higher operating leverage at Gujarat plant, increasing Nexa outlets, and improving the business mix; we believe that the company has further room to improve its margins.

Aurobindo Pharma:

We expect the company to report a net profit to grow at 19 percent CAGR during FY2018-20E, aided by acquisitions. Valuations of the company are cheap V/s its peers and own fair multiples of 17-18x.

Narnolia Financial Advisors

Larsen & Toubro:

The company has laid down an audacious target of order inflow of 10-12 percent with revenue guidance of 12-15 percent. The working Capital is aimed at getting lower to 18 percent.

Current bid pipeline looks strong with Rs 9-10 lakh Cr worth of orders are lined up. Though the H1FY20 may be impacted due to the ongoing election, H2FY20 is expected to come back strongly. Capacity Utilization of the country has improved to 74 percent.

Reaching close to 80-85 percent utilization will open avenues for increased capex in the country, and L&T should be the key beneficiary.

ICICI Bank:

The bank has shown strong turnaround on the asset quality front on account of decline in slippages, as well as good traction in recovery & up-gradation. Specific provision cover has improved to 71 percent led by aggressive provisioning done by the management.

BB & below-rated book is continuously declining and stood at 2.99 percent against 3.3 percent a quarterback. The majority of the recent corporate slippages were from this pool.

Moderation in NPA addition and improvement in margins will boost the profitability in FY20. Management targets consolidated ROE of 15 percent in the near-term and will relook at the target once credit cost normalizes.

UltraTech Cement:

UltraTech Cement has posted a strong set of numbers with consolidated revenue growth of 16 percent on a YoY basis to Rs 10,905 crore and PAT growth of 127 percent on YoY to Rs. 1,014 crore.

EBITDA margin has improved by 250bps on YoY to 21.4 percent led by lower power, freight, and other expenses. Considering recent upsurge in crude prices, freight and power cost are expected to increase slightly which may have some impact on margins in the upcoming quarter.

The company has posted 14 percent YoY growth in volumes primarily led by the strong demand in affordable housing projects.

Going forward, general elections may impact some demand in the beginning of the financial year. But, post-elections, infrastructural spending and the Housing-For-All scheme will likely gain momentum, which gives us strong volume growth visibility for the rest of the year.

The integration of UNCL and Jaypee assets is now getting stabilized and is likely to achieve PBT break-even in the next fiscal.

Britannia Industries:

We expect strong new product pipeline and distribution expansion (grown 2.8x in last 5 years) to drive volume growth while higher saliency of premium product in mix and judicious price hike will help in expanding margin.

The company will continue concentrating on new launches, newer categories and continued renovation in the existing product portfolio. The company clocked 7 percent volume growth in Q4FY19.

The innovation contribution in FY19 stood at 4.5 percent and targets to take the same to 9 percent in FY20. Going forward, the company will commercialize three lines in the next four month at the Ranjangaon Plant and come up with innovation in premium cookies, crackers, premium creams, health, dairy and adjacent business in FY20.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

The article was updated with the latest developments.