Indian shares rise over 1% as banks jump after an insolvency resolution

BENGALURU: Indian shares rose on Tuesday, lifted by gains in bank shares after steel conglomerate JSW Steel completed an insolvency process, allowing lenders to recover some of their bad loans.

The blue-chip NSE Nifty 50 index rose 1.7% to 14,757.50 and the benchmark S&P BSE Sensex gained 1.6% at 49,792.04, by 0503 GMT.

JSW Steel said on Friday it completed a resolution plan for Bhushan Steel and Power, including a payment of 193.50 billion rupees ($2.66 billion) to financial creditors.

"The JSW Steel resolution has given impetus to the banks as many of them were lenders to the bankrupt company," said Anita Gandhi, director at Arihant Capital Markets.

Major lenders to Bhushan, including State Bank of India Punjab National Bank, Canara Bank were up over 1% each and ICICI Bank gained 2.1%.

The Nifty bank index rose 1.9% and the public sector bank index gained 1.1%.

The Nifty metals index rose 3.2% and was the top gainer among sectoral indexes.

A rise in steel prices globally as well as locally are expected to increase the profits for steel companies and there has been lot of upgrades to the companies in the sector, Gandhi said.

Shares of Manganese Ore (India) Ltd jumped 7.3%, while Steel Authority of India Ltd, Jindal Steel, Tata Steel rose over 4% each.

Shares of Indian mobile gaming platform Nazara Technologies Ltd surged more than 80% in their market debut on Tuesday, reflecting investor enthusiasm for technology firms in a frenzied period for public listings.

Volumes are expected to be lighter in a holiday-shortened week, with the Indian exchanges being closed on Monday and the coming Friday.