HDFC Securities is bullish on City Union Bank has recommended buy rating on the stock with a target price of Rs 210 in its research report dated 09 Aug 2018.
HDFC Securities' research report on City Union Bank
CUBK’s 1Q show mirrored its stable performance through FY18 as advances grew ~17% YoY and fee traction sustained (up 12% sequentially). While margins were down 12bps QoQ (4.24%) the dip was on expected lines. Though CUBK continues to prudently provide (~Rs 80mn) on O/S SR’s, overall provisions were down ~10% sequentially.
Steady growth and a tight grip on asset quality will keep best-in-class return ratios steady. With a stable show yet again, CUBK remains a steady compounder in our view. Maintain BUY with a TP of Rs 210 (3x Mar-20E ABV of Rs 70).
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