Indian stocks climbed for the third day after earnings at some of the nation’s biggest companies exceeded analysts’ estimates and foreign funds added to their holdings of local shares.
The S&P BSE Sensex gained 0.7 percent to 20,160.82 at the close in Mumbai, with the gauge’s 50-day volatility rising to near a 10-month high. Coal India Ltd. rallied the most in five weeks after fourth-quarter profit at the world’s top producer beat estimates. Reliance Industries Ltd., the owner of the world’s largest refining complex, climbed to a two-month high.
Profits at just five of the 25 companies in the benchmark gauge that reported March-quarter earnings so far have trailed estimates, compared with 43 percent in the three months ended Dec. 31, data compiled by Bloomberg show. The Sensex has risen 3.8 percent in 2013, climbing to more than a two-year high on May 17, as foreigners bought a net $14.6 billion of shares this year, a record for the period, the data show.
“Results of large-cap stocks have not disappointed and that’s comforting investors,” Kaushik Dani, a fund manager at Peerless Mutual Fund, which has about $870 million in assets, said by phone from Mumbai. “Liquidity remains strong” because of monetary easing by global central banks, he said.
Coal India reported a better-than-forecast 35 percent jump in profit to 54.1 billion rupees ($973 million) after markets closed yesterday. The median of 34 analyst estimates compiled by Bloomberg was for a profit of 49.6 billion rupees. The stock surged 2.9 percent to 323 rupees.
Reliance, which has the second-highest weighting in the Sensex, rose 1.8 percent to 843.4 rupees, adding to yesterday’s 5.3 percent gain after the company announced a “significant” gas discovery. Cigarette maker ITC Ltd., which has the highest weighting, climbed 1.8 percent to 340 rupees.
GAIL India Ltd., the nation’s largest supplier of natural gas, added 0.7 percent to 326.65 rupees. The stock pared an intraday advance of 3.2 percent. Fourth-quarter profit climbed 28 percent to 6.18 billion rupees, trailing the 8.6 billion rupees estimated by 37 analysts in a Bloomberg News survey.
Sun Pharmaceutical Industries Ltd. fell 1.7 percent to 996.25 rupees, retreating from a record. India’s most valuable drugmaker reported net income rose 23 percent to 10.1 billion rupees, beating the 9.17 billion rupees estimated by analysts. The company announced plans to give one free share for every stock held, it said in an exchange filing.
Hindalco Industries Ltd. retreated 0.5 percent to 110.05 rupees. India’s second-largest aluminum producer reported net income fell 25 percent to 4.82 billion rupees ($86 million) in the March quarter, still beating the 3.87 billion rupees estimated by analysts in a Bloomberg News survey.
Both Sun Pharma and Hindalco announced earnings after the markets closed.
Hindustan Petroleum Corp., India’s third-largest state refiner, added 1.1 percent to 288.9 rupees after its fourth-quarter profit surged 66 percent to 76.8 billion rupees. That beat the 69 billion rupees estimated by analysts. The stock is not part of the Sensex.
The Sensex trades at 13.9 times projected 12-month profits, compared with the MSCI Emerging Markets Index’s 10.4 times, data compiled by Bloomberg show.
The CNX Nifty Index on the National Stock Exchange of India Ltd. added 0.5 percent to 6,111.25. Its May futures settled at 6,109.40. India VIX, which gauges the cost of protection against losses in the Nifty, rose 0.5 percent.