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Indian shares rose on Wednesday, aided by strong quarterly updates from finance companies and banks, while inflation concerns kept investors cautious a day ahead of the Reserve Bank of India's monetary policy decision.

The Nifty 50 index was up 0.50% at 17,485.40, as of 10:20 a.m. IST. The S&P BSE Sensex rose 0.59% to 59,453.74.

Eight of the 13 major sectoral indexes advanced, with high weightage financials rising over 1%. Bajaj Finance Ltd jumped over 3% and was among the top Nifty 50 gainers after new loans booked during the March quarter grew 20% year-on-year.

Index heavyweight HDFC Bank Ltd rose over 1.5% after it reported a 20.8% year-on-year rise in deposits.

"Indian lenders appear to be in a comfortable position and asset quality concerns are limited," analysts at Kotak Institutional Equities said in a note.

Upstream oil companies rose after the government cut windfall tax on crude oil to zero and halved it on diesel.

Meanwhile, analysts await the RBI's rate decision on Thursday. The central bank is likely to raise rates by 25 basis points (bps) and then pause for the rest of the year, according to a Reuters poll of economists.

The central bank raised the repo rate by 250 bps to 6.50% in the previous financial year.

Analysts expect domestic equities to be muted ahead of corporate earnings for the March quarter, starting next week.

"Value stocks will win over growth stocks", said Saurabh Jain, assistant vice president of research at SMC Securities and identified capital goods, private banks, hotels and infrastructure as preferred sectors.

($1 = 82.1575 Indian rupees)