Indian Stocks Decline on Lower Earnings; Automakers Advance

By Pooja Thakur

Jan. 29 (Bloomberg) -- Indian stocks fell, with the key index snapping a two-day 6.7 percent rally on concern lower-than- expected corporate earnings will drag shares lower.

Wipro Ltd., India’s third-largest software developer, fell 3.9 percent. Ranbaxy Laboratories Ltd., the nation’s largest drugmaker, dropped 2.8 percent.

“Earnings have been disappointing,” said Mahesh Patil, who manages $8.8 billion at Birla Sunlife Asset Management in Mumbai. “Revenues have contracted and cost pressures are high, now with demand declining it will create a problem.”

Mahindra & Mahindra Ltd., the largest local maker of sport- utility vehicles, added 3.7 percent, leading automakers higher after the government cut retail fuel prices for the second time in less than two months.

The Bombay Stock Exchange’s Sensitive Index, or Sensex, fell 34.79, or 0.4 percent, to 9,222.68 as of 3:21 p.m. local time. The S&P CNX Nifty Index on the National Stock Exchange fell 36.30, or 1.3 percent, to 2,813.30.

The following are among the most active shares traded on the Bombay and National stock exchanges. Stock symbols are in parentheses after company names:

Asian Paints (India) Ltd. (APNT IN) dropped 29.65 rupees, or 3.8 percent, to 750.95, its lowest since April 2007. The nation’s largest paintmaker reported that its founders pledged a 15 percent stake following tightened disclosure norms.

GAIL India Ltd. (GAIL IN) slid 5.20 rupees, or 2.6 percent, to 196.05. India’s monopoly natural gas distributor said yesterday third-quarter profit declined 59 percent to 2.53 billion rupees. That was below the 5.9 billion rupees median estimate of analysts surveyed by Bloomberg News.

Power Grid Corp. (PWGR IN) declined 2.45 rupees, or 2.7 percent, to 88.60. India’s biggest electricity transmission company reported a 3 percent decline in third-quarter profit to 3.72 billion rupees.

Reliance Power Ltd. (RPWR IN) added 1.25 rupees, or 1.2 percent, to 103.85. The unit of India’s third-largest power generator may win its third so-called ultra mega power project with the lowest bid to build a 4,000 megawatt electricity generation plant. Reliance Power quoted a price of less than 2 rupees a unit to sell power from the coal-fired project in Jharkhand state, said an official of the state-run Power Finance Corp., which manages the bidding on behalf of India’s Power Ministry.

To contact the reporter on this story: Pooja Thakur in Mumbai at 9032 or pthakur@bloomberg.net