Indian shares rise; Larsen & Toubro up on unit sale

(Updates to early-morning)

MUMBAI, May 15 (Reuters) - Indian shares rose more than 1 percent on Thursday morning, led by outsourcers and banks, with top infrastructure play Larsen & Toubro (LART.BO: Quote, Profile, Research) rising smartly on its sale of a unit.

Shares in Larsen & Toubro, India's leading engineering and construction firm, rose 2.6 percent to 2,904.95 rupees after it sold its ready-mix cement business to France's Lafarge (LAFP.PA: Quote, Profile, Research) at an enterprise value of $349.5 million. [ID:nBOM44883].

Shares in software-services providers, which get more than half their revenue from the United States, extended gains as the rupee remained near 13-month lows against the dollar.

Infosys Technologies Ltd (INFY.BO: Quote, Profile, Research), second-largest software services provider rose 4.4 percent to 1,905.95 rupees while top outsourcer Tata Consultancy Services (TCS.BO: Quote, Profile, Research) was up 1.9 percent at 988 rupees. The sector index rose 2.14 percent.

"We are in a rangebound market with abysmal volumes," said Deepak Singh, an independent analyst from Bangalore.

"This is a market where money can be made only by focusing on niche stories, staying nimble and having small profit targets."

At 10:28 a.m. or 0458 GMT, the benchmark BSE 30-share index was up 1.35 percent, or 228.90 points, at 17,207.25, with 26 components gaining.

The index, which rose 10.5 percent in April, is still about 15 percent down in 2008.