'This is because with no linguistic, geographic, caste or religious focus, in its appeal the AAP is similar to the Congress,' the brokerage said in a research note.<br /><br />

Contrary to the market concerns that the rise of the Aam Admi Party is detrimental to the Bharatiya Janata Party, brokerage house Credit Suisse has said the one-year-old party, which has formed government in Delhi, is likely to decimate the Congress and work in favour of the BJP in the forthcoming general elections.

"This is because with no linguistic, geographic, caste or religious focus, in its appeal the AAP is similar to the Congress," the brokerage said in a research note.

Analysing the recent state assembly elections, it has said that the AAP has eaten into the Congress's vote share and not the BJP's.

In the just concluded elections, the Congress gained vote share in both Madhya Pradesh and Chhattisgarh. In Rajasthan, though its vote share dropped 3 percent, more people voted for it in 2013 than in 2008, the brokerage has noted.

"This doesn't look like an anti-Congress wave. The wave only manifested itself in Delhi where a credible alternative (AAP) was present," it has said. So, in effect, it is some of the Congress voters who may have turned to the AAP. They would not have voted for the BJP anyways.

The brokerage has found 72 seats, where the Congress was at the top slot in 2009 and the BJP at the second slot and where the vote gap between the two parties was less than 15 percent.

"If the AAP's impact is smaller than in Delhi, and they swing only 5% of the votes, 39 seats will get affected. Thus, as the AAP eats into the Congress votes, the BJP may benefit from the fragmentation," the brokerage has noted.

Further, Credit Suisse has ruled out high volatility in the market on the results day. For the market to swing +/-20%, there has to be major shifts in the voting pattern.

For a +20 percent move in the stock market, one party/ alliance must win 220-plus seats and form the government with only 3-4 additional parties. A 20% decline on the day of the results can happen if none of the two large alliances-the UPA or NDA-is able to get even 160 seats.

"This would bring in a third front government, and raise question-marks on rating agency action, even though in our view fundamentally even a fragmented coalition can deliver growth as well as reforms," it has said.

For the NDA to not get even 160 seats, the vote swing in its favour would need to be less than 5 percent, i.e. 23% national vote share from 22% in 2009. On the other hand, to get 220-plus seats, the NDA would need up to a 25 percent-plus vote swing, i.e. 28 percent vote share.

Credit Suisse does not see both these happening, and so extreme volatility is unlikely in the stock market on the results day.