Filed at 2:36 a.m. ET

TOKYO, Oct 27 (Reuters) - Honda Motor Co (NYSE:HMC) , the world's seventh-biggest car maker, nearly tripled its annual profit forecasts as second-quarter earnings fell less than forecast, thanks to government stimulus schemes around the world that boosted sales.

Honda has weathered the industry turmoil, which drove two U.S. automakers to bankruptcy this year, better than many as its profitable and dominant motorcycle business cushioned the blow.

Sales by the maker of Honda Civic cars have turned up thanks to government sales incentives such as the United States' cash-for-clunkers programme. That has helped Honda and others gradually lift production levels from a nadir earlier this year.

Honda said on Tuesday its operating profit for July-September fell 56 percent to 65.54 billion yen ($712 million) from 148.85 billion yen in the second quarter last year as sales volumes fell and the yen strengthened against the dollar.

The result beat an estimate of 42 billion yen in a poll of five analysts by Thomson Reuters (NYSE:TRI) (TSX:TRI) I/B/E/S.

Net profit, which includes its earnings from the red-hot Chinese market, was 54.04 billion yen, against 123.32 billion yen last year.

For the full year to March 31, 2010, Honda nearly tripled its operating profit outlook to 190 billion yen from 70 billion yen.

The seventh biggest car maker by first-half sales also nearly tripled its net forecast to 155 billion yen from 55 billion yen absolutely free credit report.

That topped consensus forecasts from 21 brokerages for Honda's operating profit for the full year to March 2010 to hit 139 billion yen, with net profit of 113 billion yen.

Rivals Toyota Motor Corp (NYSE:TM) and Nissan Motor Co (NASDAQ:NSANY) are also expected to report improved second-quarter earnings next week, but Honda is seen making the most profit by far for the full year, partly due to its more flexible operations, fewer exports from Japan and a slim car line-up.

While market forecasts suggest earnings will continue to improve for Honda next year, auto executives are concerned about volatile currency moves and repercussions on demand when government stimulus measures around the world end.

Honda's sales in Japan, for one, have been powered by generous tax reductions on hybrids such as its new Insight model, and executives have said sales could suffer when the incentives run their course.

Shares of Honda gained 3.9 percent during the second quarter, outperforming Tokyo's transport sector subindex, which was flat.

Honda ended down 1.9 percent at 2,845 yen on Tuesday before the results were announced, against the transport sector's 1.7 percent fall.

Honda Raises Forecast as Stimulus Fuels Sales