The BSE Sensex climbed 0.7 percent on Wednesday, led by energy conglomerate Reliance Industries and software services exporters Infosys and Tata Consultancy Services.
Bharti Airtel (BRTI.NS), the country's top mobile operator, fell as much as 6.5 percent after the company reported a surprising 22 percent fall in quarterly profit, hurt by higher interest costs.
Top private-sector lender ICICI Bank Ltd (ICBK.NS) dropped as much as 2.7 percent after nearly 15.9 million shares, or 1.4 percent of the bank's equity, changed hands in block deals on the National Stock Exchange.
By 10:39 a.m. (0509 GMT), the main 30-share BSE index was up 0.7 percent at 17,745.8, with 25 of its components advancing.
Neeraj Dewan, director at Quantum Securities, said there would be volatility after the benchmark gained 14 percent in 2012.
I think we will not see a major correction if there is no bad news coming, he said.
Reliance Industries, which has the heaviest weight on the index, rose 1.7 percent after the company said it is in talks with major domestic airlines to provide jet fuel infrastructure and transport services.
Tata Consultancy Services, India's biggest software services exporter, rose 1.8 percent ahead of a strategic announcement expected around 2:45 p.m. (0915 GMT).
Rival Infosys climbed 1 percent.
Bharti was down 5.45 percent after it reported a December quarter net profit of 10.11 billion rupees, sharply below market expectations of 13.45 billion rupees. Its monthly average revenue per user, a key metric for telecom carriers, fell an annual 6 percent for its domestic operations.
The 50-share NSE index was up 0.67 percent at 5,371. In the broader markets, gainers led losers by about 2.8:1, on volume of around 275 million shares.
Elsewhere in the region, the MSCI's broadest index of Asia Pacific shares outside Japan was up 0.8 percent, while Japan's Nikkei was up 0.8 percent.
STOCKS ON THE MOVE
* Ballarpur Industries Ltd (BILT.NS) fell as much as 3 percent, a day after the paper maker said its December quarter net profit fell 71.6 percent.
* ARSS Infrastructure Projects (ARSS.NS) fell by daily limit of 5 percent after the company reported quarterly net loss of 123.6 million rupees.
TOP 3 BY VOLUME
* ICICI Bank with 18.03 million shares.
* Bharti Airtel with 9.5 million shares.
* Manappuram Finance (MNFL.NS) with 8.07 million shares.