BLOOMBERG NEWS
By Rajhkumar K Shaaw
June 9 (Bloomberg) -- Indian stocks rose to a 10-month high, led by Larsen & Toubro Ltd., after Prime Minister Manmohan Singh said the economy can rebound to a 9 percent growth rate amid the global recession.
Larsen & Toubro, India’s biggest engineering company, surged 6.3 percent, while Jaiprakash Associates Ltd., the largest builder of dams, climbed 8.1 percent after Singh said there is “maneuverability” on roads and ports. Tata Consultancy Services Ltd. led software providers higher after Satyam Computer Services Ltd. said it was profitable before its former chairman disclosed a $1 billion fraud in January.
“People are betting on a good recovery and earnings growth,” said S. Krishnakumar, vice-president of equities at Sundaram BNP Paribas Asset Management Co. Ltd. in Chennai, who manages $420 million. “If that were to materialize, then markets would go higher.”
The Bombay Stock Exchange’s Sensitive Index, or Sensex, rose 461.08, or 3.1 percent, to 15,127, the highest since Aug. 12. The S&P CNX Nifty Index on the National Stock Exchange advanced 2.7 percent to 4,550.95. The BSE 200 Index added 3.1 percent to 1,836.78.
DLF Ltd., the nation’s largest developer, jumped 10 percent to 402.65 rupees, and Larsen & Toubro added 6.3 percent to 1,572.80 rupees. Jaiprakash advanced 8.1 percent to 224.20 rupees.
The economy grew at more than 9 percent in three of the past four years and may expand at 7 percent in the current fiscal year, Singh said. Gross domestic product expanded 5.8 percent in the three months to March 31, beating the 5 percent median forecast in a Bloomberg News survey of economists.
Satyam
Satyam surged by the 10 percent daily limit to 66.80 rupees after it reported 1.6 billion rupees ($33.6 million) profit for the quarter ended Dec. 31.
Hyderabad, India-based Satyam made the first public disclosure of earnings estimates since former Chairman Ramalinga Raju said in January he inflated the software provider’s assets by more than $1 billion, prompting India’s biggest corporate fraud probe.
The accuracy of the results cannot be guaranteed as the financial figures stretching back to 2000 have yet to be verified by an independent auditor, the company said in a statement to the National Stock Exchange.
Among other software companies, Tata Consultancy Services, the largest software services provider, jumped 5.4 percent to 782.15 rupees, Infosys Technologies Ltd., the second-biggest, rose 3 percent to 1,794.8, and Wipro Ltd., the No. 3, advanced 4.4 percent to 423.60.
The U.S. government’s plans to boost funding for banks will help software service providers and they are expected to do well over the next 12 months, Krishnakumar said.
Tech Mahindra Ltd., which bought a controlling stake in Satyam in April, soared 26 percent to 744 rupees.
The following were among the most active stocks on the exchange:
Refiners: Indian Oil Corp. (IOCL IN), the nation’s biggest state-owned refiner, declined 4.6 percent to 553.25 rupees. Bharat Petroleum Corp. (BPCL IN), the second-biggest, fell 3.3 percent to 448.30 rupees and Hindustan Petroleum Corp. (HPCL IN) tumbled 2.2 percent to 322.50 rupees.
Refiners fell after Economic Times reported that the government may defer lifting curbs on retail prices of gasoline and diesel. Removing the curbs will enable refiners to profit from crude’s 54 percent advance this year.
“The cabinet will take a decision,” Oil Secretary R.S. Pandey said by telephone from New Delhi today. “It is they who will decide if fuel prices can be freed with crude oil at these levels.”
Pantaloon Retail India Ltd. (PF IN) rose 3.7 percent to 310.55 after the Mint newspaper reported TPG is leading a race to buy less than 15 percent of India’s biggest publicly traded supermarket operator. Kishore Biyani, managing director of Pantaloon, didn’t immediately respond to a mobile-phone text message seeking comment. Spokesman Atul Takle couldn’t be contacted immediately.
Unitech Ltd. (UT IN), India’s second biggest developer, added 5.5 percent to 88.55 rupees after it was raised to “neutral” from “sell” at MF Global Sify Securities Pvt. in Mumbai, which cited an improvement in liquidity and demand.
To contact the reporters on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net
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