January 4, 2018 9:27 pm JST

India shares gain on global cues, rally in state-owned banks

Larsen & Toubro, ONGC among major movers

MUMBAI (NewsRise) -- Indian shares advanced Thursday, helped by positive global cues and a rally in state-owned banks.

The benchmark BSE Sensex rose 0.5% to 33,969.64 and the broader Nifty 50 Index added 0.6% to 10,504.80.

The week's best session for the Indian markets came after yet another upbeat day on Wall Street. The S&P 500 Index climbed to its lifetime highs for the second day after U.S. factory activity rose more-than-expected and as Federal Reserve's December minutes reinforced policymakers' concerns over low inflation.

The surge in Japanese markets as investors returned from the New Year break also boosted regional sentiment. The Nikkei 225 Index closed 3.3% higher.

India's finance ministry sought approval from parliament for an additional expenditure of 800 billion rupees ($12.6 billion) to recapitalise the nation's state-run banks. The request is part of New Delhi's plan, announced in October, to inject 2.11 trillion rupees over the next two years to recapitalize the lenders struggling under massive bad debts.

"We are seeing progress as to the time lines on capital infusion, which is positive for the banks and for the economy," said Kishor Ostwal, managing director at CNI Research.

An index of state-run banks climbed 2.7%. State Bank of India rose 1.7%, while Punjab National Bank and Bank of Baroda gained at least 3.8% each.

Among other movers, Oil and Natural Gas Corp. advanced 2.9% after Brent crude prices rallied overnight to climb back to two-and-a-half year highs.

Larsen & Toubro hit record highs, advancing 3.1% to 1,315.40 rupees. HSBC said it was upbeat on the company's growth, retaining a `buy' rating and a target price of 1,415 rupees.

Hindalco Industries, one of the biggest producers of primary aluminum in Asia, added 1.2%. The company has submitted a non-binding bid for U.S. aluminum producer Aleris Corp., Bloomberg reported citing people with knowledge of the matter. A deal could value Aleris at around $2.5 billion including debt, according to the report.

Dr. Reddy's Laboratories climbed 3.1% to 2,409.50 rupees. Nomura said that while regulatory concerns remain for the drug maker's site in the state of Andhra Pradesh, the fact that it so far avoided escalation of the matter into an import alert is a positive. Nomura has a `buy' rating on the stock with a target price of 3,281 rupees.

Tata Motors dropped 0.8% after its unit's Jaguar Land Rover's U.S. sales declined 9% in December.

Housing Development Finance Corp. rose 0.3%. The mortgage lender said its profit on sale of investments for the December quarter stood at 52.70 billion rupees, including 52.50 billion rupees from the proceeds of the initial public offer of HDFC Standard Life Insurance. The company proposed an additional special provision of 15.75 billion rupees to "build an additional buffer against any unexpected risk in the future".

Nitesh Estates jumped by the daily limit of 20% following a report by The Times of India that Shanghai-based Fosun Group was in advanced discussions to invest 8 billion rupees in the developer.

SJVN jumped 11.9% after the hydroelectric power generation company said it will consider a share buyback next week.

--Nimesh Vora and Vidyut Deshpande

Asia300

State Bank of India

India

Market(Ticker): BOM(500112)
Sector:
Industry:
Finance
Regional Banks
Market cap(USD): 41,823.9M
Shares: 8,632.05M
Asia300

Oil & Natural Gas Corp. Ltd.

India

Market(Ticker): BOM(500312)
Sector:
Industry:
Energy Minerals
Oil & Gas Production
Market cap(USD): 38,951.4M
Shares: 12,833.2M
Asia300

Larsen & Toubro Ltd.

India

Market(Ticker): BOM(500510)
Sector:
Industry:
Industrial Services
Engineering & Construction
Market cap(USD): 30,134.8M
Shares: 1,401.03M
Asia300

Hindalco Industries Ltd.

India

Market(Ticker): BOM(500440)
Sector:
Industry:
Non-Energy Minerals
Other Metals/Minerals
Market cap(USD): 9,087.47M
Shares: 2,244.94M
Asia300

Dr. Reddy's Laboratories Ltd.

India

Market(Ticker): BOM(500124)
Sector:
Industry:
Health Technology
Pharmaceuticals: Generic
Market cap(USD): 6,467.02M
Shares: 165.82M
Asia300

Tata Motors Ltd.

India

Market(Ticker): BOM(500570)
Sector:
Industry:
Consumer Durables
Motor Vehicles
Market cap(USD): 20,909.4M
Shares: 3,395.85M
Asia300

Housing Development Finance Corp. Ltd.

India

Market(Ticker): BOM(500010)
Sector:
Industry:
Finance
Finance/Rental/Leasing
Market cap(USD): 47,599.6M
Shares: 1,597.59M

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