MUMBAI, March 1 (Reuters) - Indian shares are likely to ease on Thursday as investors shift their focus to a government share sale in Oil and Natural Gas Corp aiming to raise at least $2.5 billion.
The offer, through a one-day auction on Thursday, is expected see heavy bidding, including by foreign funds.
Shares in ONGC, the country's largest oil producer, are expected to extend gains after rising 3.5 percent on Wednesday to 293.20 rupees -- just above the 290 rupee floor price set for the sale.
"Big buyers would obviously divert more funds to ONGC share sale," said Kishor Ostwal, chairman, CNI Research.
Factory output data due at 10:30 a.m. (0500 GMT) will be watched for clues on the outlook after data on Wednesday showed the economy grew at its slowest pace in nearly three years in the December quarter.
The MSCI's measure of Asian markets other than Japan fell 0.56 percent by 0255 GMT, while the Nifty India stock futures index in Singapore was down 0.4 percent, indicating a lower start for Indian shares.
The main 30-share BSE index rose 3.3 percent in February -- its second monthly rise.
STOCKS TO WATCH
* Tata Communications would be watched after the Times of India reported the company is preparing to bid for Britain's Cable & Wireless Worldwide Plc.
* Videocon Industries is likely to fall, after the company with interests in consumer electronics and oil reported a 47 percent drop in quarterly profit.
* Sun Pharmaceutical Industries Ltd is expected to rise after the drugmaker received U.S. Food and Drug Administration approval for generic Zyprexa Zydis tablets. Zyprexa Zydis, a registered trademark of Eli Lilly and Co , is a drug for treatment of schizophrenia.
FACTORS TO WATCH * Indian rupee report * Indian bond report * Euro, Aussie hit by wave of profit taking post ECB * Oil ends Feb. higher on upbeat U.S. Fed report * U.S. stocks fall after Bernanke remarks * Wall St snaps 4-day advance after Bernanke remarks * Foreign institutional investor flows * For closing rates of Indian ADRs (Reporting by Kaustubh Kulkarni and Rajesh Kurup; Editing by Ranjit Gangadharan)
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