Indian shares climb 2.2 pct, energy firms rise

Enlarge Photo The Bombay Stock Exchange building is seen in Mumbai in this May 22, 2006 file...

Thu, May 15 05:12 PM

By Hiral Vora

MUMBAI (Reuters) - Indian shares rallied 2.2 percent on Thursday to their highest close in a week, boosted by gains in Reliance Industries Ltd and Reliance Communications Ltd, which won regulatory nod for its unit's share sale.

A weak rupee , which has depreciated about 2 percent this week, helped shares in export-driven software services companies that get more than half their revenue from the United States.

Traders said expectations for tax breaks for exploration, as global oil prices remained stubbornly near record highs, lifted energy stocks.

Reliance Industries, leading private sector oil firm, rose 3.7 percent to 2,622.65 rupees, its highest close in five days, while state-run Oil and Natural Gas Corp and smaller explorer Cairn India Ltd each gained 1.2 percent.

"The rise was mostly due to news driven movements in specific index stocks, especially Reliance Industries and Reliance Communications," said R.K. Gupta managing director of Taurus Asset management.

"There was some short-covering also in some other leading stocks."

Reliance Communications, India's No. 2 mobile services firm, climbed 5.3 percent to an almost three-month closing high of 589 rupees after sources said it had received the market regulator's nod for an initial public offer of 10 percent in its telecoms tower unit.

The 30-share BSE index closed up 2.21 percent, or 375.19 points, at 17,353.54, its highest close since May 6, with 24 components gaining.

The benchmark, which rose 10.5 percent in April, is more than 14 percent down in 2008 and 18.2 percent off a record high of 21,206.77 hit on Jan. 10.

In the broader market, 1,768 gainers beat 911 losers on volume of more than 366 million shares.

Software bellwether Infosys Technologies rose 3.6 percent to 1,891.30 rupees, top exporter Tata Consultancy Services firmed 1.6 percent to 985.45 rupees and smaller rival Wipro gained 1 percent to 508.85 rupees.

Larsen & Toubro, India's leading engineering and construction firm, rose 4.7 percent to 2,962.50 rupees after it sold its ready-mix cement business to France's Lafarge at an enterprise value of $349.5 million.

The 50-share NSE index rose 2.07 percent to 5,115.25.

Elsewhere in the region, Karachi's 100-Share index fell 0.78 percent to 14,479.87 points, while Colombo's All-Share index closed 0.07 percent up at 2,609.85.

STOCKS THAT MOVED

* State-run National Aluminium Co Ltd rose 3.9 percent to 517.20 rupees, after its chairman said it had shortlisted two to three coal mines in Indonesia to secure supplies for its proposed 750 megawatt power plant.

* Kirloskar Brothers Ltd gained 4.2 percent to 250.30 rupees after its joint venture Meil-Maytas KBL received contracts worth about 9.3 billion rupees from Andhra Pradesh government to construct pump houses.

MAIN TOP 3 BY VOLUME

* Aishwarya Telecom Ltd on 70.5 million shares.

* IFCI Ltd on 21.9 million shares.

* Ispat Industries Ltd on 10.9 million shares.

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