Indian shares at 2-mth closing low; Reliance falls

* Shares fall for sixth session, longest losing run in a
year

* Reliance Inds falls 5.7 pct

* Reliance Comm drops as much as 7.8 pct as profit halves

* Bharti, Maruti buck trend to end higher
(Updates to close)

By Ami Shah

MUMBAI, Nov 3 (Reuters) - Indian shares dropped 3.1 percent
on Tuesday, a sixth straight fall that took the market to its
lowest close in two months, pulled down by a sell-off in energy
giant Reliance Industries (RELI.BO: Quote, Profile, Research) and weak global markets.

Disappointing corporate earnings announced over the
weekend, including from second-ranked mobile operator Reliance
COmmunications (RLCM.BO: Quote, Profile, Research) also weighed on investor sentiment.

Reliance Industries fell 5.7 percent to 1,820.65 rupees,
its lowest close in nearly four months, ahead of the resumption
of a court hearing over terms of a deal to supply gas to
Reliance Natural Resources (RENR.BO: Quote, Profile, Research).

"Too many things are bothering Reliance (Industries): bad
results, court case and falling refining margins," said Rajen
Shah, chief investment officer at Angel Broking.

Reliance Communications (RLCM.BO: Quote, Profile, Research) fell 5.7 percent to
165.90 rupees, its lowest close in more than seven months,
after its quarterly earnings halved and as a crunching call
tariff war threatened more pain ahead. [ID:nDEL225049]

The stock is down over 46 percent since the end of
September. "There is already tremendous pressure on
operating margins because of the price war and tariff erosion,
and today's fall is a knee-jerk reaction to the results," said
K.K. Mital, head of portfolio management services at Globe
Capital.

The 30-share BSE index .BSESN fell 3.1 percent or 491.34
points to 15,404.94, with 27 of components declining.

It was the biggest percentage point fall since Aug. 17, and
the index has now lost 8.4 percent over the six sessions.

"Market is coming down to saner levels," said Shah.

"We had more than doubled in a span of few months, and
nothing other than liquidity flow supported that kind of
surge." Foreign funds have poured in more than $14 billion
so far this year into equities, which are up nearly 60 percent.

World stocks fell on Tuesday as investors continued to
worry over the early removal of government stimulus,
particularly in the financial sector. [ID:nL319620]

Top lender State Bank of India (SBI.BO: Quote, Profile, Research) fell 4 percent to
2,103.50 rupees on concerns over asset quality, even after it
reported a 10.2 percent rise in quarterly profit on the
weekend. [ID:nBOM460896]

"We maintain Reduce on SBI due to concern on aggressive
growth which might lead to further pressure on NIMs (net
interest margins) and asset quality," Alchemy Share & Stock
analysts Shashin Upadhyay and Rahul Jain said in a note.

Aluminium producer Hindalco (HALC.BO: Quote, Profile, Research) declined 10.5 percent
to 109.15 rupees, after its September quarter net profit
halved. [ID:nBOM490316]

Consumer goods maker Hindustan Unilever (HLL.BO: Quote, Profile, Research) fell 3.6
percent to 272.75 rupees, reporting its September quarter net
profit dropped 21.6 percent. [ID:nBOM377381].

Top mobile operator Bharti Airtel (BRTI.BO: Quote, Profile, Research) bucked the
weaker trend on the day, rising 2.7 percent to 299.95 rupees,
although it is still down more than 28 percent since the end of
September.

"Bharti is just trying to catch up after the recent fall,"
said Shah.

Top car maker Maruti Suzuki (MRTI.BO: Quote, Profile, Research) climbed 1.1 percent
to 1,418.80 rupees, after its October sales rose an annual 32.4
percent [ID:nBMA006321].

In the broader market, four stocks fell for every one that
rose, with volume a moderate 412 million shares.

The 50-share NSE index .NSEI fell 3.14 percent to
4,563.90, its lowest close in 2-½ months.

STOCKS THAT MOVED

* Suzlon Energy (SUZL.BO: Quote, Profile, Research) fell 12.9 percent to 58.25
rupees, its lowest close in more than six months, after the
wind turbine maker said its September quarter loss widened and
cut its full-year sales forecast due to order delays.
[ID:nN31447140] [ID:nBOM535009]

* Sugar maker Balrampur Chini Mills (BACH.BO: Quote, Profile, Research) fell 10.1
percent to 134.30 rupees, after it denied it was in stake sale
talks with Bajaj Hindusthan (BJHN.BO: Quote, Profile, Research). [ID:nBOM495865]

MAIN TOP 3 BY VOLUME

* Suzlon Energy on 22.2 million shares

* Reliance Natural Resources at 21.5 million shares

* Indiabulls Power (INDP.BO: Quote, Profile, Research) on 16 million shares

FACTORS TO WATCH
* For technical analysis double click on www.reutersindia.net
* India rupee report
[INR/]
* India bond report
[IN/]
* Dollar gains as stocks fall; sterling sinks
[FRX/]
* Oil slips below $78 as dollar strengthens
[O/R]
* Stocks fall on stimulus worries
[MKTS/GLOB]
* U.S. stock index futures point to lower open
[.N]
* For closing rates of Indian ADRs
INADR
(Editing by John Mair)