James Dennin, Kapitall: Could these 7 rallying Indian stocks keep their momentum through election season, or do they portend correction?

The world's largest election in history was already going to be a pretty important market event, but the stakes are climbing higher and higher as India gets closer to selecting its new leadership.

The stock market there has performed exceptionally so far this year. The benchmark Sensex Index has beaten all the other Asian markets in 2014, hitting an all-time high last week. The Rupee has recovered from a dismal performance last year as well causing the IMF to boost India's outlook.

Read more of this Kapitallist's take on Indian stocks. 

Much of the optimism there surrounds the likely election of Narendra Modi, widely seen as the "pro-business" candidate and a more experienced alternative to his primary rival Rahul Gandhi, the grandson of Indira Ghandi. 

On the other hand, there's also a sizeable chance bulls have gotten ahead of themselves

For one, Modi is hardly a scandal-free candidate.  The Economist, possibly the world's most important authority when determining what exactly constitutes a pro-business candidates, has refused to endorse him. 

His critics don't worry about his economics, however; Modi has a strong nationalist bent that has some concerned. During his tenure in office there was a riot in his district where nearly 2,000 Muslims were allegedly beaten or killed. 

Still, Indian stock performance is a telling measure of how the market will respond to a Modi victory. India badly needs many of the economic reforms that he has promised. But India's election will also be the largest of all time, in a country with infamously bad polling. 

In the last 2 major elections, most pollers projected the exact opposite outcome of what eventually transpired. In 2004 election day chaos caused one of the largest single-day selloffs in India's history. 

Is the market right to start pricing in Modi's election, or are Indian stocks getting ahead of themselves? Use the list below to begin your own analysis and let us know what you think in the comments. 

Click on the interactive chart to view data over time. 

1. HDFC Bank Ltd. ( HDB): Provides banking and financial services to individuals and businesses in India. Market cap at $26.93B, most recent closing price at $33.78.

SMA 200: 15.11%


2. ICICI Bank Ltd. ( IBN): Provides various banking and financial services in India and internationally. Market cap at $19.72B, most recent closing price at $34.65.

SMA 200: 22.66%


3. MakeMyTrip Limited ( MMYT): Provides travel products and solutions in India and the United States. Market cap at $954.11M, most recent closing price at $25.33.

SMA 200: 9.96%



4. Dr. Reddy's Laboratories Ltd. ( RDY): Operates as a pharmaceutical company. Market cap at $7.66B, most recent closing price at $45.05.

SMA 200: 11.47%



5. Sesa Sterlite Limited ( SSLT): Mines, produces, and exports iron ore. Market cap at $8.76B, most recent closing price at $11.82.

SMA 200: 10.49%


6. Tata Motors Ltd. ( TTM): Engages in the manufacture and sale of commercial and passenger vehicles primarily in India. Market cap at $21.1B, most recent closing price at $32.78.

SMA 200: 24.77%


7. Wipro Ltd. ( WIT): Provides information technology (IT) products and services, and consumer care and lighting products primarily in India, the United States, and Europe. Market cap at $33.64B, most recent closing price at $13.70.

SMA 200: 5.4%


(List compiled by James Dennin, a Kapitall Writer. Monthly returns sourced from Zacks Investment Research, all other data sourced from Finviz.)