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Last Updated : Feb 07, 2019 03:27 PM IST | Source: Moneycontrol.com

Buy City Union Bank; target of Rs 236: HDFC Securities

HDFC Securities is bullish on City Union Bank has recommended buy rating on the stock with a target price of Rs 236 in its research report dated January 28, 2019.

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HDFC Securities' research report on City Union Bank


Yet again, CUBK performed consistently, across parameters. Loan growth was steady and broad based at 17%, fees grew ~16%, NIMs improved ~10bps sequentially, CASA (24%) and the PCR (65%) remained stable. Superior performance can be inferred from a closer look at the fine print: NIMs driven by growth in avg loans, sequential SA growth of ~8% (after 3% in 2Q), a stable net stressed book (even after the slippages of the large paper exposure of ~Rs 800mn) and conservative coverage (~46%) on the SR book.


Outlook


Given these virtues, we assign a target multiple of 3xDec-20E ABV to arrive at a TP of Rs 236. Maintain BUY.


For all recommendations report, click here


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First Published on Feb 7, 2019 03:27 pm
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