April 20 (Bloomberg) -- Indian stocks rose for a second day, led by Reliance Industries Ltd. and ICICI Bank Ltd., amid speculation overseas investors stepped up purchases of the nation's equities.
Reliance, the nation's most valuable company, rose 1.3 percent and ICICI, the country's second-largest lender, climbed 2.1 percent. Overseas investors were net buyers of Indian equities every day this month through April 16, data on the regulator's Web site shows. Larsen & Toubro Ltd., the nation's biggest engineering company, gained after Citigroup Inc. raised the stock's rating.
"Liquidity is driving this rally," said Jayesh Shroff, who helps manage $5.5 billion in assets at SBI Asset Management Co. in Mumbai.
The Bombay Stock Exchange's Sensitive Index rose 1.1 percent to 11,148.31 as of 11:15 a.m. local time. The S&P CNX Nifty Index on the National Stock Exchange gained 1.1 percent to 3,420.55. The BSE 200 Index increased 1.6 percent to 1,324.02. Nifty futures for April delivery added 1.1 percent to 3,418.90.
Reliance rose 1.3 percent to 1,740 rupees. ICICI, the country's second-largest lender, gained 2.1 percent to 450.15 rupees.
Overseas funds acquired about $700 million worth of Indian stocks this month through April 16, according to the nation's market regulator. Foreign investors bought a net 3.96 billion rupees ($79 million) of the country's equities on April 16, the data shows.
Larsen rallied 2.7 percent to 892.50 rupees. India's biggest engineering company was raised to "buy" from "sell" at Citigroup, which cited the removal of an "overhang" from Satyam Computer Services Ltd. and the outlook for earnings.
Larsen lost the bidding for control of Satyam Computer, the software exporter at the center of India's biggest fraud inquiry. Tech Mahindra Ltd. won after agreeing to pay $579 million.
The following shares were among the most active on the exchange:
Cipla Ltd. (CIPLA IN), the country's third-biggest drugmaker by sales, fell 3.1 percent to 222.80 rupees after opposing Adcock Ingram Healthcare Ltd.'s bid for its marketing partner in South Africa. In addition, the Economic Times reported the U.S. drug regulator is investigating Cipla's manufacturing process at a factory in Bangalore.
Power Grid Corp. (PWGR IN) added 4.5 percent to 101.85 rupees. India's biggest electricity transmitter plans to spend 120 billion rupees this year, the Financial Express reported yesterday, citing Chairman and Managing Director S.K. Chaturvedi.
Satyam Computer (SCS IN) climbed 4 percent to 47.35 rupees. Tech Mahindra (TECHM IN) may have to consider cutting almost 10 percent of Satyam's workforce, the Wall Street Journal reported April 17, citing Satyam Chairman Kiran Karnik.
Tech Mahindra climbed 1.5 percent to 339.70 rupees. The company raised 6 billion rupees selling bonds, it said in a filing with the Bombay Stock Exchange on April 18.
To contact the reporter on this story: Pooja Thakur in Mumbai at pthakur@bloomberg.net
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