Indian shares rise 1.8 pct on govt vote hopes

* Shares rally as investors bet government to win vote

* Confidence vote expected around 6 p.m. (1230 GMT)

* Power equipment makers, utilities up on nuclear deal
hopes

* Top car maker Maruti Suzuki tumbles on outlook concerns
(Updates to close)

By Narayanan Somasundaram

MUMBAI, July 22 (Reuters) - Indian shares rose 1.8 percent
on Tuesday to their highest close in almost a month, as
investors speculated the government would win a confidence vote
in parliament and put an end to political uncertainty.

The market has climbed for four days in a row, taking gains
over the period to 13.7 percent. Lawmakers are expected to vote
on the confidence motion around 6 p.m. (1230 GMT).
[ID:nISL288787]

It was the longest run of gains since mid-April, but
traders were cautious about the outlook.

If the government won the vote, it would help clinch a
civilian nuclear deal with the United States, but a loss could
lead to snap elections.

"Today's trade was based solely on the opinion the ruling
coalition will win the confidence vote. To me, tomorrow is the
D-day, not today," said R.K. Gupta, managing director at Taurus
Mutual Fund, said.

"Whichever way the vote pans out we are ripe for some
correction after the run up we have had."

For a factbox on likely market reactions to the confidence
vote, see [ID:nBOM239884].

The 30-share BSE index .BSESN rose 1.84 percent, or
254.16 points, to 14,104.20, its best close since June 26.
Twenty four components rose.

The benchmark had started lower and climbed as much as 2.6
percent, before paring gains toward the close. It is down 30.5
percent in 2008.

Power equipment maker Bharat Heavy Electricals (BHEL.BO)
rose 6 percent to 1,597.50 rupees and Larsen & Toubro (LART.BO)
climbed 2.3 percent to 2,571.75 rupees on hopes a government
win would help them expand to nuclear power equipment.

Those expectations also helped utilities NTPC (NTPC.BO),
Tata Power (TTPW.BO) and Reliance Power (RPOL.BO).

NTPC rose 2 percent to 185 rupees, Tata Power gained 6.2
percent to 1,108.65 rupees and Reliance Power firmed 7.9
percent to 142.75.

Top car maker Maruti Suzuki Ltd (MRTI.BO) fell 9.3 percent
to 587.95 rupees, its biggest single-day fall since May 2006,
on concerns about its outlook.

Maruti, 54.2 percent owned by Japan's Suzuki Motor Corp
(7269.T), reported late on Monday a sharp drop in June quarter
operating margins to 10 percent from 14.6 percent a year
earlier. [ID:nBOM219854].

In the broader market, 1,843 gainers overwhelmed 734 losers
on volume of 271 million shares.

Financial stocks extended gains as oil hovered around $130
a barrel, well below record highs of above $147, raising hopes
the central bank may not increase interest rates when it
reviews policy on July 29.

No. 2 lender ICICI Bank (ICBK.BO) rose 2.7 percent to
661.30 rupees and top lender State Bank of India (SBI.BO)
firmed 3.8 percent to 1,397.70 rupees, its highest close since
May 30.

The sector index .BSEBANK gained 3.1 percent.

The 50-share NSE index .NSEI rose 1.9 percent to
4,240.10.

Elsewhere in the region, Karachi's 100-share index .KSE
rose 3.96 percent to 10,784.81 points, but Colombo's All share
index .CSE dropped 1.76 percent to 2,338.63.

STOCKS ON THE MOVE

* ITC (ITC.BO) rose 6 percent to 189.90 rupees and
Hindustan Unilever Ltd (HLL.BO) gained 2 percent to 232.55
rupees on increasing investor interest in the consumer goods
sector considered a defensive play in a slowing economy.

* Tata Steel (TISC.BO) rose 4.3 percent to 624.35 rupees
after its Thailand unit TSTH.BK reported a surge in quarterly
net profit and on expectations for a domestic price rise.

* Areva T&D India Ltd AREV.BO rose 6.2 percent to
1,617.15 rupees after it said its board would consider
splitting each share into five on July 29.

* Tech Mahindra Ltd (TEML.BO) rose 9.7 percent to 744.65
rupees after the telecom software services firm said quarterly
net profit rose 52 percent.

* United Spirits (UNSP.BO) surged 16.5 percent to 1,221.35
rupees after it reported June quarter net profit rose 34
percent.

MAIN TOP 3 BY VOLUME

* Reliance Natural Resources Ltd (RENR.BO) on 22.1 million
shares

* Infrastructure Development Finance Co (IDFC.BO) on 12.3
million shares.

* IFCI (IFCI.BO) on 12 million shares.

FACTORS TO WATCH
* For technical analysis double click on www.reutersindia.net
* Indian rupee gains on hopes govt may win vote
[INR/]
* Indian bond yields rise as crunch vote eyed
[IN/]
* FOREX-Dlr pinned near lows as financial gloom persists
[FRX]
* Oil steadies near $131, eye on storm
[O/R]
* GLOBAL MARKETS-Vodafone, weak earnings hit euro stocks, oil
up [MKTS/GLOB]
* US STOCKS- Wall st set to fall after flurry poor results

[.N]
For closing rates of Indian ADRs
INADR
(Editing by Ranjit Gangadharan)