Indian shares fall 3 pct; Satyam jumps, Wipro drops

* Satyam climbs 44 pct as rescue hopes grow

* Wipro falls 9.3 pct on World Bank bar on direct contracts

* Concerns about quarterly earnings keep investors wary
(Updates to close)

By Janaki Krishnan

MUMBAI, Jan 12 (Reuters) - Indian shares fell 3.15 percent
to their lowest close in more than five weeks on Monday as
investors braced for tough quarterly earnings, but
scandal-scarred Satyam (SATY.BO) jumped 44 percent on hopes a
government-appointed board will rescue the company.

Traders said the broader market was also weighed down by
concerns about tighter regulations and more negative
disclosures by companies.

Shares in Satyam Computer Services Ltd jumped 44.2 percent
to 34.40 rupees on hopes a newly constituted three-member
board, appointed by the government, would help salvage the
company's clients and staff. [ID:nBOM370906]

Deepak Parekh, chairman of Housing Development Finance Corp
(HDFC.BO) and a new director of Satyam, is expected to address
a news conference at 5 p.m. (1130 GMT).

Satyam's market value had slumped to $330 million last week
from more than $7 billion just six months ago following
revelations of an accounting fraud.

Wipro Ltd (WIPR.BO) shed 9.3 percent to 227.35 rupees after
the No. 3 outsourcer said the World Bank had barred the company
in June 2007 from direct contracts until 2011, citing a
conflict of interest. [ID:nBOM184642]

The 30-share BSE Index .BSESN dropped 296.42 points to
9,110.05, its lowest close since Dec. 5. It briefly pared
losses to 0.8 percent after industrial output unexpectedly rose
in November, but then fell 4.1 percent before pulling back.

Ved Prakash Chaturvedi, managing director at Tata Mutual
Fund, said the market was reacting to negative news in India
and globally.

"Funds, both domestic and foreign, are not buying and that
is a cause for concern. People are also scared that corporate
earnings may not be as good as previous quarters or maybe
worse," he said.

Mid-sized software services firm Megasoft Ltd (MSFT.BO)
fell to an all-time low of 13.80 rupees after the World Bank
said it had barred the firm for four years in December 2007 for
participating in a joint venture with bank staff while
conducting business with the bank. The stock closed down 0.6
percent at 15.75 rupees.

"People are apprehensive there might be more such
disclosures and there are wild rumours doing the rounds," said
Gaurang Shah, chief manager at Geojit Financial Services.

Twenty-eight of the BSE index components fell, while in the
broader market losers overwhelmed gainers in the ratio of
1.96:1 on above average volume of 283.7 million shares.

No. 2 outsourcer Infosys Technologies (INFY.BO), which
announces quarterly results and gives its outlook on Tuesday,
closed down 3.2 percent at 1,156.60 rupees. [ID:nBOM121491]

The 50-share NSE Index .NSEI closed down 3.5 percent at
2,773.10 points.

STOCKS THAT MOVED

* Top lender State Bank of India (SBI.BO) closed down 4.9
percent at 1,156.85 rupees after its chairman said on
television that bank had about 5 billion rupees exposure to
Maytas Infra MAIL.BO, in which the founders of Satyam have a
stake. [ID:nBMA002158]

* Construction firm PBA Infrastructure (PBAI.BO) closed up
15.8 percent at 30.35 rupees after the company said it had
received an order worth 4.59 billion rupees for building roads
and drains. [ID:nBMB004157]

MAIN TOP 3 BY VOLUME

* Satyam Computer on 53.2 million shares

* Reliance Natural (RENR.BO) on 18.3 million shares

* United Ltd (UNTE.BO) on 17.4 million shares.

FACTORS TO WATCH
* Indian rupee report
[INR/]
* Indian bond report
[IN/]
* FOREX-Yen gains on global gloom; euro slides as ECB eyed

[FRX/]
* Oil falls $2 to below $39 as demand weakens
[O/R]
* GLOBAL MARKETS-Economy fears hit stocks and oil again

[MKTS/GLOB]
* US STOCKS-U.S. stock futures mixed; Alcoa earnings eyed
[.N]
* For closing rates of Indian ADRs
INADR
(Editing by Ranjit Gangadharan)