Indian Stocks Gain Most in 3 Months, Led by Infosys, Reliance

By M.C. Govardhana Rangan

July 2 (Bloomberg) -- Indian stocks rose for the first day in four, led by software exporters including Infosys Technologies Ltd. on the expectation a weakening rupee will boost overseas earnings.

The Bombay Stock Exchange's Sensitive Index, or Sensex, rose 702.94, or 5.4 percent, to 13,664.62, the biggest jump since March 25. India's key benchmark has plunged more than 35 percent from its record in January and India's overall market value yesterday slipped below $1 trillion for the first time in a year.

``From a three-year perspective, these levels could give a decent return even if the economy grows at around 6 percent'' a year, said Tridib Pathak, chief investment officer at Lotus India Asset Management Co., which manages assets equivalent to about $1.8 billion.

Infosys Technologies, India's second-largest software exporter, rose 6 percent, the most in more than two months, to 1,820.6. Reliance Industries Ltd., which gets more than half its revenue from overseas markets according to data compiled by Bloomberg, gained 4.9 percent, the most in more than three months, to 2,143.1.

Satyam Computer Services Ltd., the nation's fourth-largest software exporter, rose 7.2 percent to 463.3, the highest since April. 29, after the company said it aims to have $1 billion of sales from Europe.

U.S. Revenue

Indian technology firms such as Infosys get more than 50 percent of their revenue in U.S. dollars. A stronger dollar increases the amount of Indian currency they receive. India's rupee fell 7.3 percent last quarter, the biggest decline in a decade. The currency yesterday fell to the lowest in 15 months as crude imports widened the trade deficit to a record.

India's market value has lost $919 billion from its record on Jan. 7 as overseas equity investors pulled $6.37 billion of funds out of the country so far this year. Net sales accelerated after the central bank raised interest rates twice last month because oil prices pushed inflation to a 13-year high.

The S&P CNX Nifty Index on the National Stock Exchange today gained 196.60, or 5.1 percent, to 4,093.35.

DLF Ltd., the nation's biggest real estate developer, jumped 15 percent, the most in nine months, to 423.95 after the company said it planned to consider a share buyback on July 10.

Banks Rebound

Bank shares led by ICICI Bank Ltd. and State Bank of India, which have lost more than half their value since peaking in January, gained after early losses on speculation the fall was overdone. ICICI Bank, the second largest, advanced 5.4 percent at 621.05 rupees, and State Bank, the largest, rose 5.2 percent to 1,078.35 rupees.

The following were among India's most active stocks. Tickers are in brackets behind company names.

Mundra Port & Special Economic Zone Ltd. (MSEZ IN): The operator of the largest cargo terminal outside state control, rose 3.15 rupees, or 0.7 percent to 481.3, after falling 19 percent following a Press Trust of India report that the Supreme Court had barred development of its land.

Ashapura Minechem Ltd. (ASMN): The miner fell 10.4 rupees, or 7.6 percent, to 126.75, sliding for the fifth straight day, after it said there were administrative delays in getting permission to export and that bauxite volumes may decline.

To contact the reporters on this story: M.C. Govardhana Rangan in Mumbai at grangan@bloomberg.net