April 24 (Bloomberg) -- India's benchmark stock index rose for a second day, climbing to a six-month high, after BNP Paribas said the gauge may rise another 10 percent because of a better outlook for corporate earnings.
ICICI Bank Ltd., Mahindra & Mahindra Ltd. and Tata Power Ltd., were among BNP's top picks that rose more than 2 percent.
"There is an improvement in fundamentals, in terms of growth in some sectors, companies' ability to raise finances to tide over balance-sheet problems, and confidence about future growth," BNP's analyst Manishi Raychaudhuri wrote.
The Bombay Stock Exchange's Sensitive Index, or Sensex, rose 1.7 percent to 11,329.05. The gauge posted its seventh week of gains advancing to its highest since Oct. 14. The S&P CNX Nifty Index on the National Stock Exchange added 1.7 percent to 3,480.75. The BSE 200 Index climbed 1.8 percent to 1,344.16. Nifty futures for April delivery added 1.4 percent to 3474.50.
The Sensex may climb to 12,300 by the end of the year, higher than an earlier forecast range of 10,000 to 11,500, Raychaudhuri said.
Indian and Chinese stocks were driven down too far in the meltdown that started last year, said Jon Thorn, manager of the India Capital Fund.
"India and China got marked down more out of fear and panic rather than for a fundamental reason," Thorn said. "Indian large caps will outperform smaller companies as the constraints on capital and cost of capital will benefit larger companies over their smaller rivals."
Indian banks are among the cheapest in the world, said Thorn, whose picks include State Bank of India, ICICI Bank and Punjab National Bank.
ICICI, Tata
ICICI, the nation's No. 2 lender, rose 2.3 percent to 434.10 rupees. Mahindra, the country's largest maker of sport- utility vehicles, added 6.1 percent to 471.30 rupees. Tata Power, India's biggest electricity generator outside state control, gained 3.8 percent to 887.65 rupees.
BNP's other picks include Axis Bank Ltd., which rose 5.5 percent to 529.60 rupees, and Bharat Heavy Electricals Ltd., which gained 1.4 percent to 1,643.40 rupees.
Overseas investors bought a net 18 million rupees ($360,000) of Indian stocks on April 22, according to the regulator.
The following shares were among the most active on the exchange:
GlaxoSmithKline Consumer Healthcare Ltd. (SKB IN) rose 6.2 percent to 785.75 rupees. The Indian maker of Horlicks and Boost health drinks said first-quarter profit rose 48 percent to 838.90 million rupees.
HDFC Bank Ltd. (HDFCB IN) added 1.6 percent to 1,110.25 rupees. India's second-biggest lender by market value reported fourth-quarter profit rose 34 percent to 6.31 billion rupees. That beat the 5.9 billion rupees median estimate of analysts surveyed by Bloomberg News.
IDBI Bank Ltd. (IDBI IN) jumped 13 percent to 67.30 rupees, the most since Oct. 13. The Indian lender said profit in the fourth quarter rose 28 percent to 3.14 billion rupees.
Piramal Healthcare Ltd. (PIHC IN) gained 4 percent to 215.95 rupees. The Indian generic drugmaker said fourth-quarter profit rose 59 percent to 1.15 billion rupees. Sales climbed 9.3 percent to 8.51 billion rupees.
Ranbaxy Laboratories Ltd. (RBXY IN) slid 2.2 percent to 175.90 rupees. India's biggest drugmaker, controlled by Daiichi Sankyo Co. of Japan, may report a loss of 180 million rupees in the quarter ended March 31, according to the median estimate of analysts surveyed by Bloomberg News.
To contact the reporter on this story: Pooja Thakur in Mumbai at pthakur@bloomberg.net
ICICI Bank Ltd., Mahindra & Mahindra Ltd. and Tata Power Ltd., were among BNP's top picks that rose more than 2 percent.
"There is an improvement in fundamentals, in terms of growth in some sectors, companies' ability to raise finances to tide over balance-sheet problems, and confidence about future growth," BNP's analyst Manishi Raychaudhuri wrote.
The Bombay Stock Exchange's Sensitive Index, or Sensex, rose 1.7 percent to 11,329.05. The gauge posted its seventh week of gains advancing to its highest since Oct. 14. The S&P CNX Nifty Index on the National Stock Exchange added 1.7 percent to 3,480.75. The BSE 200 Index climbed 1.8 percent to 1,344.16. Nifty futures for April delivery added 1.4 percent to 3474.50.
The Sensex may climb to 12,300 by the end of the year, higher than an earlier forecast range of 10,000 to 11,500, Raychaudhuri said.
Indian and Chinese stocks were driven down too far in the meltdown that started last year, said Jon Thorn, manager of the India Capital Fund.
"India and China got marked down more out of fear and panic rather than for a fundamental reason," Thorn said. "Indian large caps will outperform smaller companies as the constraints on capital and cost of capital will benefit larger companies over their smaller rivals."
Indian banks are among the cheapest in the world, said Thorn, whose picks include State Bank of India, ICICI Bank and Punjab National Bank.
ICICI, Tata
ICICI, the nation's No. 2 lender, rose 2.3 percent to 434.10 rupees. Mahindra, the country's largest maker of sport- utility vehicles, added 6.1 percent to 471.30 rupees. Tata Power, India's biggest electricity generator outside state control, gained 3.8 percent to 887.65 rupees.
BNP's other picks include Axis Bank Ltd., which rose 5.5 percent to 529.60 rupees, and Bharat Heavy Electricals Ltd., which gained 1.4 percent to 1,643.40 rupees.
Overseas investors bought a net 18 million rupees ($360,000) of Indian stocks on April 22, according to the regulator.
The following shares were among the most active on the exchange:
GlaxoSmithKline Consumer Healthcare Ltd. (SKB IN) rose 6.2 percent to 785.75 rupees. The Indian maker of Horlicks and Boost health drinks said first-quarter profit rose 48 percent to 838.90 million rupees.
HDFC Bank Ltd. (HDFCB IN) added 1.6 percent to 1,110.25 rupees. India's second-biggest lender by market value reported fourth-quarter profit rose 34 percent to 6.31 billion rupees. That beat the 5.9 billion rupees median estimate of analysts surveyed by Bloomberg News.
IDBI Bank Ltd. (IDBI IN) jumped 13 percent to 67.30 rupees, the most since Oct. 13. The Indian lender said profit in the fourth quarter rose 28 percent to 3.14 billion rupees.
Piramal Healthcare Ltd. (PIHC IN) gained 4 percent to 215.95 rupees. The Indian generic drugmaker said fourth-quarter profit rose 59 percent to 1.15 billion rupees. Sales climbed 9.3 percent to 8.51 billion rupees.
Ranbaxy Laboratories Ltd. (RBXY IN) slid 2.2 percent to 175.90 rupees. India's biggest drugmaker, controlled by Daiichi Sankyo Co. of Japan, may report a loss of 180 million rupees in the quarter ended March 31, according to the median estimate of analysts surveyed by Bloomberg News.
To contact the reporter on this story: Pooja Thakur in Mumbai at pthakur@bloomberg.net
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