Indian shares gain 0.1 pct; Reliance, realty rise

* Profit-taking erases early gains of 1.3 pct

* Reliance Industries, ONGC lead rise

* Tata Motors drops nearly 8 pct after annual loss

* Investors wary of high hopes on budget next week
(Updates to close)

By Prashant Mehra

MUMBAI, June 29 (Reuters) - Indian shares eked out a modest
rise of 0.1 percent on Monday after investors locked in profits
ahead of the budget next week, erasing early gains of as much
as 1.3 percent.

Lower Asian markets, where weaker oil prices hit energy
shares, also encouraged investors to cut their long positions,
traders said.

Leading petrochemicals and refiner Reliance Industries
(RELI.BO) climbed on media reports a court had approved its
plan to absorb unit Reliance Petroleum (RPET.BO).

Tata Motors (TAMO.BO), the country's top vehicle maker,
fell almost 8 percent after it posted its first annual loss in
eight years late on Friday. [ID:nBOM433658]

Export-focused outsourcers led by Tata Consultancy Services
(TCS.BO) and Infosys Technologies Ltd (INFY.BO) dropped more
than 2 percent each ahead of quarterly earnings that begin next
month.

"There are local factors but we are partly following the
global trend," said Deepak Jasani, head of retail research at
HDFC Securities. "Some nervousness may come in before the
budget, but we expect the underlying positive sentiment to
continue."

The government is likely to keep tax rates broadly
unchanged in its budget next Monday and explore other avenues
such as 3G wireless spectrum auction and stake sales in state
firms to raise cash. [ID:nDEL496126]

However, there were concerns about how the government aimed
to plug its burgeoning fiscal deficit.

The 30-share BSE index .BSESN ended up 0.14 percent, or
21.10 points, at 14,785.74 points, with 13 stocks closing
higher. Index heavyweight Reliance Industries rose 2.8
percent to 2,084.95 rupees, its highest close in nearly two
weeks.

State-run explorer Oil and Natural Gas Corp (ONGC.BO)
gained 2.6 percent to 1,068.05 rupees on hopes the government
would partially deregulate auto fuel pricing and help ease
subsidy burden for state energy firms.

Top developer DLF (DLF.BO) and rival Unitech (UNTE.BO) rose
on hopes of easing cashflows after the latter got commitment to
raise about $575 million from institutions for its second share
sale in as many months. [ID:nDEL491575]

DLF rose 3.8 percent to 338 rupees, while Unitech gained
3.6 percent to 85.30 rupees.

Top outsourcer Tata Consultancy Services fell 2.8 percent
to 385.90 rupees, Infosys lost 2.4 percent to 1,783.75 rupees
and while Wipro (WIPR.BO) shed 1.3 percent to 378.65 rupees.

Tata Motors fell 7.8 percent to 313.85 rupees.

Sun Pharmaceuticals (SUN.BO) dropped 3.5 percent to
1,100.35 rupees as the company withdrew its 2009/10 sales
guidance after U.S. authorities last week seized drugs made by
its unit, Caraco Pharmaceutical (CPD.A), for violating
manufacturing standards.

"There was profit-taking today, the market's taking a
breather. But the long positions are there, the bias will
remain upward," said Gajendra Nagpal, chief executive at Unicon
Financial Intermediaries.

Overall, the market sentiment remained positive. In the
broader market, gainers led losers 1.7 to 1 on moderate volume
of 395 million shares.

The 50-share NSE index ended up 0.35 percent at
4,390.95 points.

MAIN TOP 3 BY VOLUME

* Suzlon Energy (SUZL.BO) on 19.5 million shares

* IFCI (IFCI.BO) on 19 million shares

* Unitech on 17.6 million shares

STOCKS THAT MOVED

* Wind turbine maker Suzlon Energy fell 5.1 percent to
117.10 rupees after the company posted a lower-than-expected
consolidated net profit of 2.36 billion rupees for 2008/09.

* Steel pipemaker Welspun Gujarat Stahl Rohren (WGSR.BO)
rose 3.9 percent to 212.20 rupees after it received orders
worth 9.6 billion rupees.

* Gujarat NRE Coke Ltd (GJNC.BO) fell 4.5 percent after the
metallurgical coke maker posted a loss of 1.03 billion rupees
in the March quarter from a profit of 642 million a year ago.

FACTORS TO WATCH
* India rupee erases gains after rising to 1-wk high
[INR/]
* Indian bond yields down as no auction announced
[IN/]
* FOREX-Dollar recovers, supported by low risk appetite
[FRX/]
* Oil rises towards $70 on Nigeria attack report
[O/R]
* Dollar edges up, stocks hold ranges
[MKTS/GLOB]
* U.S. stock futures flat ahead of Madoff sentencing
[.N]
* For closing rates of Indian ADRs
INADR
(Editing by Ranjit Gangadharan)