Tata Consultancy Leads India's Sensex Index Gain; Grasim Industries Climbs

India’s stocks rose, with the benchmark index advancing for a second straight week, led by software exporters after Tata Consultancy Services Ltd. quarterly net income beat estimates.

Tata Consultancy, the nation’s biggest software-services provider, gained the most in a year. Its first-quarter profit rose 20 percent to 18.4 billion rupees ($394 million), exceeding the 17.6 billion rupee average of 25 analyst estimates compiled by Bloomberg. Grasim Industries Ltd., a cement maker owned by the Aditya Birla Group, climbed for the first time in four days after it was upgraded by Morgan Stanley.

The Bombay Stock Exchange’s Sensitive Index, or Sensex, added 46.36, or 0.3 percent, to 17,955.82 after swinging between gains and losses at least 12 times. The gauge climbed 0.7 percent for the week, its second week of gains. The S&P CNX Nifty Index on the National Stock Exchange increased 0.3 percent to 5,393.90. The BSE 200 Index rose 0.4 percent to 2,287.54.

“The positive numbers from Tata Consultancy gave some confidence to the markets,” said Mumbai-based Sadanand Shetty, a fund manager at Taurus Asset Management Co., which manages $640 million in assets. “Overall, though, it seems earnings upgrades are not happening for Sensex companies.”

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Tata Consultancy surged 6.6 percent to 833.65 rupees, its biggest climb since July 30. Profit rose for a fifth consecutive quarter as overseas companies outsourced more business to India’s largest software-services provider. Infosys Technologies Ltd., the second-largest, added 0.6 percent to 2,777 rupees.

Tata Consultancy is the first Sensex company to announce results for the June quarter that beat estimates. Infosys and Housing Development Finance Corp. reported earnings this week that lagged behind analysts’ estimates.

Grasim rose 1.3 percent to 1,834.1 rupees. The stock was raised to “overweight” from “equal-weight” by Ashish Jain, an analyst at Morgan Stanley, who said the stock trades at a “deep discount” to its fair value and that a likely “weakness” in the shares over the next two months will be an opportunity for investors to add to holdings.

Tata Motors Ltd., India’s biggest truckmaker and owner of Jaguar Land Rover, extended gains for the second day after saying global sales rose 46 percent in June. The stock advanced 2.8 percent to 832.4 rupees, after rising 1.2 percent yesterday.

Overseas funds bought a net 6.47 billion rupees of Indian equities on July 14, increasing total investments in the stocks this year to 388 billion rupees, according to the nation’s market regulator.

Inflows from overseas reached a record 834.2 billion rupees in 2009, exceeding the high set two years ago in local currency terms, as the biggest advance in 18 years lured foreign funds. They sold a record 529.9 billion rupees of shares in 2008, triggering a record annual decline.

The following were among the most active on the exchange:

Hindustan Motors Ltd. (HM IN) advanced 8.6 percent to 25.95 rupees. India’s oldest carmaker rose after Nikkei English News reported Mitsubishi Motors Corp. may buy its South India plant. Mitsubishi has no plans to buy the factory, spokesman Kai Inada said today by phone.

Sesa Goa Ltd. (SESA IN) climbed 1.1 percent to 343.25 rupees. India’s biggest iron ore exporter plans to invest $500 million to expand its mining and supply infrastructure, the Hindu Business Line reported, quoting Prasun Kumar Mukherjee, managing director. Mukherjee couldn’t immediately be reached at his office telephone for comment on the report.

Technofab Engineering Ltd. (TECE IN) surged 24 percent to 296.95 rupees in its trading debut. The engineering and construction company raised 718 million rupees selling 2.99 million shares to the public at 240 rupees a piece.

Tilaknagar Industries Ltd. (TLNGR IN) jumped 7.2 percent to 168.2 rupees. The liquor manufacturer rose after its shares started trading on the National Stock Exchange, India’s largest bourse, in addition to the Bombay Stock Exchange. The move will increase the volume of shares traded and prompt “more funds to play in”, said Sameer Vedak, an analyst at Finquest Securities Pvt., who rates the stock as “buy.”

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

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