IIFL Securities Stock Idea: Buy Union Bank Of India with Target Rs 177

On June 3rd, IIFL Securities recommended buying Union Bank of India shares, setting a target price of Rs 177. The current market price is Rs 169. This recommendation is based on the bank's recent financial performance and positive market outlook. Union Bank of India has reported strong growth in its loan book and deposits, and its asset quality has improved. The bank is also expected to benefit from the government's focus on financial inclusion and the improving economic environment.

About Union Bank Of India:

Union Bank of India is a government-owned financial institution headquartered in Mumbai, India. It offers a wide range of banking services, including retail, corporate, and international banking. As of March 2023, the bank had a network of over 9,600 branches and ATMs across the country. Union Bank of India is known for its strong presence in the agricultural and rural sectors, and is actively involved in promoting financial inclusion. The bank has a strong track record of performance and has received several awards and accolades for its services.

52 Week Price Trend:

Union Bank of India's stock has witnessed a significant increase in its market price, currently trading at Rs 169. This represents a substantial rise from its 52-week low of Rs 60.32, reflecting a remarkable recovery in its share value. However, the stock's performance is still below its 52-week high of Rs 155.35, indicating room for further growth potential.

Stratzy's MOST Analysis:

UnionBank has been rated AAA by Stratzy's MOST framework, which assesses companies based on Management, Outlook, Safety, and Trend. This AAA rating indicates that UnionBank exhibits strong fundamentals across all four pillars. The bank's management is highly experienced and effective, the outlook for future growth is positive, safety measures are robust, and the overall trend is favorable. This AAA rating suggests that UnionBank is a low-risk investment with strong fundamentals and a positive outlook.

Company's Fundamentals:

Union Bank of India (NSE: UNIONBANK) is a leading public sector bank in India. Its current stock price-to-earnings (PE) ratio of 8.21 indicates that investors are willing to pay 8.21 times the company's annual earnings to own its shares. The price-to-book (PB) ratio of 1.28 suggests that the bank's market value is 1.28 times its book value, indicating that it is slightly overvalued. Furthermore, the dividend yield of 2.04% indicates that the bank is paying out 2.04% of its share price to investors as dividends annually, making it an attractive option for income-oriented investors. Overall, these metrics suggest that Union Bank of India is currently undervalued compared to the broader market and offers potential upside for investors.

Fundamental and Technical information provided in this blog were last updated on 01 Jun, 2024

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