Nov. 4 (Bloomberg) -- India’s stocks rose the most in three months, snapping the benchmark index’s biggest losing streak in a year, after Finance Minister Pranab Mukherjee said the government will not withdraw stimulus measures.

DLF Ltd., the biggest real estate developer, jumped 8.7 percent after Mukherjee said late yesterday India will wait until the economy is fully recovered before rolling back its stimulus spending. Jaiprakash Associates Ltd., a builder of roads, bridges and dams, soared 9.4 percent.

“The government should continue with the stimulus as corporate results have shown that sales growth has been tepid,” said P. Phani Sekhar, who manages funds for wealthy individuals at Angel Broking Ltd. in Mumbai. “This shows economic recovery has not been as strong as the bottom line growth suggests.”

The Bombay Stock Exchange’s Sensitive Index, or Sensex, gained 507.19, or 3.3 percent, to 15,912.13. The gauge lost 8.4 percent over the past six trading sessions on concerns a stimulus withdrawal may snap a nascent recovery in an economy that expanded 6.7 percent in the year ended March, the slowest pace since 2003.

The S&P CNX Nifty Index on the National Stock Exchange climbed 3.2 percent to 4,710.80. The BSE 200 Index increased 3.3 percent to 1,962.56.

DLF gained 8.7 percent to 365 rupees. Jaiprakash Associates advanced 9.4 percent to 212.55 rupees. Tata Steel Ltd., the biggest producer of the alloy, rose 5.3 percent to 469 rupees.

Tata Consultancy, Satyam

Mukherjee’s comments came after Reserve Bank of India Governor Duvvuri Subbarao signaled in a policy meeting on Oct. 27 the government would start withdrawing a stimulus program that has seen 5.85 trillion rupees ($124 billion) pumped into the economy since September 2008. That’s equivalent to 9 percent of 2008 GDP.

The country’s largest technology companies also advanced on new contracts. Tata Consultancy Services Ltd., the biggest software services exporter, gained 3.2 percent to 625.7 rupees after the Economic Times reported it won a 15-year outsourcing contract with Cardiff Council, the municipal government of the Welsh capital. Chief Financial Officer S. Mahalingam confirmed the order after the close, without providing details.

Satyam Computer Services Ltd. rose 4.4 percent to 103.1 rupees after the software provider signed an agreement with Saab AB to develop defense and battlefield management systems, the company said in an e-mailed statement yesterday. The deal with Saab is worth $400 million, Bloomberg-UTV television channel reported.

Metals Rally

Sterlite Industries (India) Ltd., the nation’s biggest copper and zinc producer, jumped 6.7 percent to 771.85 rupees after its price estimate was raised to 665 rupees from 581 rupees at Citigroup Inc.

The stock also gained as metal prices rallied. Copper for three-month delivery rose $140, or 2.2 percent, to $6,600 a metric ton on the London Metal Exchange. December-delivery copper gained 1.6 percent to $3.003 a pound on the New York Mercantile Exchange’s Comex unit.

Hindalco Industries Ltd., the biggest aluminum producer, soared 9.3 percent to 119.15 rupees as the metal rose 0.9 percent at $1,925 a ton on the London Metal Exchange.

Overseas funds bought a net 7.36 billion rupees of Indian stocks on Oct. 30, the Securities and Exchange Board of India said on its Web site. The funds have bought 684.3 billion rupees of Indian stocks this year to date, compared with record net sales of 530 billion rupees for the whole of 2008.

The following were among the most active stocks on the exchange:

Hindustan Zinc Ltd. (HZ IN) gained 4.5 percent to 896.45 rupees. The price estimate of the metal producer was raised to 842 rupees from 588 rupees at Citigroup Inc.

Tata Motors Ltd. (TTMT IN) climbed 3.2 percent to 570.2 rupees. India’s biggest truckmaker and owner of Jaguar Land Rover Ltd. will build as many as 25,000 Jaguar XJ luxury car annually starting next quarter in a bid to take customers from Bayerische Motoren Werke AG’s 7 Series and Daimler AG’s Mercedes S Class, Ian Callum, Jaguar’s design director, said in an interview in Detroit.

Titan Industries Ltd. (TTAN IN) advanced 1.5 percent to 1,288.6 rupees. India’s biggest watch and jewelry retailer was raised to “overweight” from “underweight” at Morgan Stanley, which said the company’s business is likely to improve.

To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net.

Last Updated: November 4, 2009 06:25 EST