India’s benchmark stock index declined for a second day as some investors judged recent gains to all-time highs as excessive.

Bharat Heavy Electricals Ltd. (BHEL), India’s biggest power-equipment maker, retreated for a fifth day. Oil & Natural Gas Corp. (ONGC), India’s largest state-owned oil explorer, decreased 1.6 percent. Larsen & Toubro Ltd. (LT), India’s largest engineering company, fell the most in two weeks.

The S&P BSE Sensex (SENSEX) lost 0.5 percent to 22,393.41 at 10:33 a.m. in Mumbai, paring a weekly gain to 0.2 percent. The CNX Nifty index declined 0.4 percent. The Nifty climbed to records for eight straight days through April 2 as international investors extended Asia’s largest stock-market inflows amid cooling inflation, shrinking deficits and a strengthening rupee. India holds a national election starting April 7, with opinion polls indicating the main opposition Bharatiya Janata Party will win the most seats, ending the Congress Party’s decade-long rule.

“For the last two days we have seen some profit-booking or consolidation,” Vineet Bhatnagar, managing director at PhillipCapital India Pvt., said on Bloomberg TV India today. “There’s continued bias on the upside.”

Election Outlook

Prime Minister Manmohan Singh’s Congress party may be headed for its worst-ever electoral performance as voters punish the government for a series of graft scandals, Asia’s fastest consumer inflation and slowing growth. The BJP is favored by investors seeking change to revive an economy expanding at the slowest pace in a decade. Results will be announced on May 16.

Bharat Heavy Electricals tumbled 2.6 percent, extending this week’s loss to 8.8 percent, the most on the Sensex. Larsen & Toubro fell 1.7 percent, the most since March 20. The S&P BSE India Capital Goods index has declined 1.7 percent this week after a 16 percent advance last month.

Oil & Natural Gas fell for the second day. Tata Motors Ltd. (TTMT), the owner of Jaguar Land Rover, decreased 1 percent, heading for the biggest loss since March 27.

Overseas investors bought a net $ 187.2 million of Indian shares on April 1 and April 2, extending this year’s purchases to $ 4.75 billion.

The Sensex has climbed 5.8 percent this year and trades at 14.1 times projected 12-month earnings, compared with the MSCI Emerging Markets Index’s 10.4 times.

The India VIX rose 2.6 percent.

To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net

To contact the editors responsible for this story: Michael Patterson at mpatterson10@bloomberg.net Matthew Oakley