Union Bank of India-2QFY2012RU

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Please refer to important disclosures at the end of this report 1

Particulars (` cr) 2QFY12 1QFY12 % chg (qoq) 2QFY11 % chg (yoy)

NII 1,661 1,590 4.5 1,536 8.2

Pre-prov. profit 1,205 1,166 3.4 1,131 6.6

PAT 353 464 (24.1) 303 16.2

Source: Company, Angel Research

For 2QFY2012, Union Bank of India reported disappointing numbers, which

were far below ours as well as street’s estimates, primarily because of the

considerably higher-than-expected provisioning expenses. Substantial

deterioration in asset quality was the key negative surprise from the results.

We downgrade the stock from Buy (on persistent stress on the asset quality) toAccumulate.

NIM improves on better CD ratio and loan yields; asset quality stress comes

to the fore: The bank’s business growth was muted, with advances growing

marginally by 1.2% qoq and deposits declining by 1.8% qoq. Even CASA

deposits base was almost flat sequentially and grew by just 8% on a yoy

basis. On the back of improvement in CD ratio and yield on advances, the

bank’s reported NIM improved by 11bp qoq to 3.2%. On the asset-quality

front, slippages ballooned to ` 1,821cr (annualized slippage ratio of 4.8%)

from an average quarterly run rate of ` 640cr over the past 12 quarters.

Management attributed a large part of the rise in slippages to the completion

of the switchover to system-based NPA recognition platform. Absoluteamounts of gross and net NPAs rose sharply by 37.1% qoq and 56.3% qoq,

respectively. Provision coverage ratio including technical write-offs slipped

sharply by 772bp qoq to 60.5%.

Outlook and valuation: In our view, Union Bank of India is structurally among

the more profitable and competitive PSU banks. We have a positive outlook

on the bank due to its robust traction in CASA deposits and relatively

fast-expanding branch network over the past few years. The asset quality

stress seems to have been largely factored into the price, in our view. Going

ahead, pick-up in recoveries from the technically slipped accounts is likely to

cushion further stress. The stock is trading at reasonable valuations of 0.8x

FY2013E P/ABV, well below its five-year median of 1.3x. Hence, werecommend an Accumulate rating with a target price of ` 238.

Key financials

Y/E March (` cr) FY2010 FY2011 FY2012E FY2013E

NII 4,192 6,216 6,725 7,621

% chg 9.9 48.3 8.2 13.3

Net profit 2,075 2,082 1,975 2,308

% chg 20.2 0.3 -5.1 16.9

NIM (%) 2.4 3.0 2.7 2.6

EPS (`) 41.1 39.6 37.5 43.8

P/E (x) 5.4 5.6 5.9 5.1P/ABV (x) 1.3 1.1 1.0 0.8

RoA (%) 1.2 1.0 0.8 0.8

RoE (%) 26.2 20.9 16.6 17.0


ACCUMULATECMP ` 222

Target Price ` 238

Investment Period 12 Months

Stock Info

Sector Banking

Market Cap ( ` cr) 11,029

Beta 1.0

52 Week High / Low 427/207

Avg. Daily Volume 112,577

Face Value ( `

) 10BSE Sensex 17,805

Nifty 5,360

Reuters Code UNBK.BO

Bloomberg Code UNBK@IN

Shareholding Pattern (%)

Promoters 57.1

MF / Banks / Indian Fls 14.7

FII / NRIs / OCBs 11.9Indian Public / Others 16.3

Abs. (%) 3m 1yr 3yr

Sensex (2.2) (10.7) 97.7

Union BoI (23.3) (41.5) 75.1

Vaibhav Agrawal

022 – 3935 7800 Ext: 6808

[email protected]

Shrinivas Bhutda

022 – 3935 7800 Ext: 6845

[email protected]

Varun Varma

022 – 3935 7800 Ext: 6847

[email protected]

Union Bank of India

Performance Highlights

2QFY2012 Result Update | Banking

October 28, 2011

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Union Bank of India | 2QFY2012 Result Update

October 28, 2011 2

Exhibit 1: 2QFY2012 performance


Interest earned 5,110 4,916 4.0 3,952 29.3

- on Advances / Bills 3,859 3,754 2.8 2,776 39.0- on investments 1,141 1,063 7.3 985 15.8

- on balance with RBI & others 86 75 13.7 56 52.9

- on others 25 23 10.6 135 (81.5)

Interest Expended 3,449 3,326 3.7 2,416 42.7

Net Interest Income 1,661 1,590 4.5 1,536 8.2

Other income 501 484 3.5 510 (1.7)

Other income excl. treasury 401 371 8.1 379 5.9

- Fee Income 298 252 18.3 286 4.2

- Treasury Income 100 113 (11.5) 131 (23.7)

- Recov. from written off a/cs 42 59 (28.8) 45 (6.7)

- Others 61 60 1.6 48 27.9

Operating income 2,162 2,074 4.2 2,045 5.7

Operating expenses 957 908 5.4 915 4.6

- Employee expenses 591 592 (0.1) 592 (0.1)

- Other Opex 366 317 15.5 323 13.3

Pre-provision Profit 1,205 1,166 3.4 1,131 6.6

Provisions & Contingencies 623 428 45.4 599 4.0

- Provisions for NPAs 495 365 35.6 629 (21.3)

- Other Provisions 128 63 101.6 (30) (524.4)

PBT 582 737 (21.0) 532 9.5

Provision for Tax 230 273 (15.8) 228 0.6

PAT 353 464 (24.1) 303 16.2

Effective Tax Rate (%) 39.5 37.0 244bp 42.9 (349)bp


Exhibit 2: 2QFY2012 Actual vs. Estimates

Particulars (` cr) Actual Estimates Var. (%)

NII 1,661 1,619 2.6

Other income 501 443 13.1

Operating income 2,162 2,062 4.9

Operating expenses 957 956 0.1

Pre-prov. profit 1,205 1,106 8.9

Provisions & cont. 623 384 62.4

PBT 582 723 (19.4)

Prov. for taxes 230 234 (2.0)

PAT 353 488 (27.8)







October 28, 2011 3

Exhibit 3: 2QFY2012 performance analysis

Particulars 2QFY12 1QFY12 % chg (qoq) 2QFY11 % chg (yoy)

Balance sheet

Advances ( ` cr) 147,284 145,567 1.2 124,142 18.6Deposits ( ` cr) 195,572 199,178 (1.8) 177,780 10.0

Credit-to-Deposit Ratio (%) 75.3 73.1 223bp 69.8 548bp

CASA deposits ( ` cr) 62,754 62,748 0.0 58,111 8.0

Reported CASA ratio (%) 32.1 31.5 58bp 32.7 (60)bp

CAR (%) 12.5 12.9 (34)bp 12.5 1bp

Tier 1 CAR (%) 8.5 8.8 (28)bp 7.9 68bp

Profitability Ratios (%)

Yield on funds 9.3 9.1 15bp 8.3 97bp

Cost of funds 6.3 6.2 9bp 5.1 119bp

Reported NIM 3.2 3.1 11bp 3.4 (14)bp

Cost-to-income ratio 44.3 43.8 47bp 44.7 (46)bp

Asset quality

Gross NPAs ( ` cr) 5,136 3,745 37.1 3,524 45.7

Gross NPAs (%) 3.5 2.6 92bp 2.8 70bp

Net NPAs ( ` cr) 2,959 1,893 56.3 1,462 102.4

Net NPAs (%) 2.0 1.3 72bp 1.2 86bp

Provision Coverage Ratio (%) 60.5 68.2 (772)bp 70.1 (955)bp

Slippage ratio (%) 4.8 2.0 279bp 3.8 104bp

LLP to avg assets (%) 0.8 0.6 21bp 1.2 (41)bp


Contraction in business; branch expansion remains slow

The bank’s business growth was muted, with advances growing marginally by

1.2% qoq and deposits declining by 1.8% qoq. Even the CASA deposits base was

almost flat sequentially and grew by just 8% on a yoy basis. Due to a sequential

contraction in overall deposits, the CASA ratio improved marginally by 58bp qoq

to 32.1%

During 1QFY2012, the bank had opened 22 branches; this pace reduced in

2QFY2012 with the bank opening only 13 branches. Management aims to open

225 branches during FY2012, implying addition of ~200 new branches during

2HFY2012.

Considering the prevailing high interest rates, the bank has further revised its

growth forecasts downwards for FY2012. The bank now plans to grow its

advances by 17-18% (earlier 19%) and deposits by 16% (earlier 17%) in FY2012.






October 28, 2011 4

Exhibit 4: Contraction in business during 2QFY2012


Exhibit 5: CASA ratio improves marginally


Both NIM and fee income improve sequentially The bank’s CD ratio improved sequentially from 73.1% in 1QFY2012 to 75.3% as

of 2QFY2012. The yield on funds also improved by 15bp to 9.3%, leading to

reported NIM increasing by 11bp to 3.2%. Management has guided for reported

NIM to be at 3.2% for FY2012. However, considering the declining growth trend in

CASA deposits, on a conservative basis, we have factored in NIM to decline by

~28bp and ~11bp in FY2012 and FY2013, respectively.

Exhibit 6: Rise in yield on funds....


Exhibit 7: Leads to an 11bp qoq improvement in NIM


Growth in non-interest income (3.5% qoq) was driven by strong 18.3% qoq growth

in fee income to ` 298cr. Recoveries from written-off accounts fell sharply by 28.8%

qoq to ` 42cr, while treasury income also declined by 11.5% qoq to ` 100cr.

We expect core fee income to grow by 15.3% and 18.0% in FY2012 and FY2013,

respectively.

( 0 . 5

)

7 . 8

1 2 . 9

( 3 . 6

)

1 . 2

3 . 7

5 . 0

8 . 5

( 1 . 6

)

( 1 . 8

)

69.8

71.7

74.6

73.1

75.3

66.0

68.0

70.0

72.0

74.0

76.0

(5.0)

-

5.0

10.0

15.0

2QFY11 3QFY11 4QFY11 1QFY12 2QFY12

Adv. qoq chg (%) Dep. qoq chg (%) CDR (%, RHS)

3 2 . 7

3 3 . 3

3 1 . 8

3 1 . 5

3 2 . 1

18.3

27.1

19.2

12.4

8.0

-

10.0

20.0

30.0

29.0

30.0

31.0

32.0

33.0

34.0


CASA ratio (%) CASA yoy growth (%, RHS)

8.288.39

8.82

9.109.25

7.50

8.00

8.50

9.00

9.50


(%)

3.353.44 3.44

3.10

3.21

2.70

2.90

3.10

3.30

3.50


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October 28, 2011 5

Exhibit 8: Break-up of non-interest income


CEB 298 252 18.3 286 4.2

Treasury 100 113 (11.5) 131 (23.7)Recoveries 42 59 (28.8) 45 (6.7)

Others 61 60 1.7 48 27.1

Other income 501 484 3.5 510 (1.8)

Other income excl. treasury 401 371 8.1 379 5.8


Slippages balloon during 2QFY2012

On the asset-quality front, slippages ballooned to ` 1,821cr (annualized slippage

ratio of 4.8%) from an average quarterly run rate of ` 640cr over the past 12

quarters. Management attributed a large part of the rise in slippages to the

completion of the switchover to system-based NPA recognition platform. Absolute

amount of gross and net NPAs rose sharply by 37.1% qoq and 56.3% qoq,

respectively. Provision coverage ratio including technical write-offs slipped sharply

by 772bp qoq to 60.5%.

On back of continued asset-quality pressures, we have increased our provisioning

estimates for the bank sharply by 37.6% and 39.2% for FY2012 and FY2013,

respectively. For FY2012, we have factored in gross NPA ratio of 3.4% and net

NPA ratio of 1.4%.

Exhibit 9: Slippages balloon in 2QFY2012


Exhibit 10: Asset-quality concerns persist


3 . 8

2 . 6

1 . 4

2 . 0

4 . 8

1.2

0.7

0.2

0.6

0.8

-

0.3

0.6

0.9

1.2

1.5

-

1.5

3.0

4.5

6.0


Slippages (%) Credit cost (%, RHS)

2 . 8

2 . 7

2 . 4

2 . 6

3 . 5

1 . 2

1 . 2

1 . 2

1 . 3

2 . 0

70.1 70.2

67.6 68.2

60.5

50.0

55.0

60.0

65.0

70.0

75.0

-

1.0

2.0

3.0

4.0


Gross NPAs (%) Net NPAs (%) PCR (%, RHS)






October 28, 2011 6

Exhibit 11: Only 13 branches opened during 2QFY12


Exhibit 12: Cost ratios back to normal levels


Sufficient capital adequacy The bank is well capitalized with CAR of 12.5% and tier-I capital of 8.5% (forming

68.1% of the total CAR). Post the recent capital infusion by the government

(cumulative ` 793cr during FY2011), its shareholding in the bank has increased to

57.1%, further increasing the headroom for raising tier-I capital in future.

Investment argument

CASA ratio expected to sustain at ~32% levels

We are relatively positive on the bank’s CASA growth outlook, owing to its large

branch expansion in recent years compared to its peers. The bank has opened~400 branches in the last two years, which according to us should aid the bank in

maintaining its CASA ratio at ~32% levels. The bank is aiming to open another

225 branches during FY2012.

Outlook and valuation

In our view, Union Bank of India is structurally among the more profitable and

competitive PSU banks. We have a positive outlook on the bank due to its robust

traction in CASA deposits and relatively fast-expanding branch network over the

past few years. The asset quality stress seems to have been largely factored into the

price, in our view. Going ahead, pick-up in recoveries from the technically slippedaccounts is likely to cushion further stress. The stock is trading at reasonable

valuations of 0.8x FY2013E P/ABV, well below its five-year median of 1.3x. Hence,

we recommend an Accumulate rating with a target price of `238.

2 , 8

6 9

2 , 9

9 3

3 , 0

1 6

3 , 0

3 8

3 , 0

5 1

2,4202,516

2,634 2,673

2,757

1,800

2,000

2,200

2,400

2,600

2,800

3,000

2,700

2,800

2,900

3,000

3,100


Branches ATMs (RHS)

4 4 . 7

4 0 . 2

6 2 . 5

4 3 . 8

4 4 . 3

1.81.6

2.6

1.5 1.6

-

0.6

1.2

1.8

2.4

3.0

-

15.0

30.0

45.0

60.0

75.0


Cost-to-income ratio (%) Opex to average assets (%, RHS)






October 28, 2011 7

Exhibit 13: Key assumptions

Particulars (%)Earlier estimates Revised estimates

FY2012 FY2013 FY2012 FY2013

Credit growth 17.0 18.0 17.0 18.0Deposit growth 18.0 18.0 18.0 18.0

CASA ratio 31.3 30.8 31.3 30.8

NIMs 2.6 2.5 2.7 2.6

Other income growth (1.3) 14.4 (1.3) 14.4

Growth in staff expenses (5.0) 15.0 (5.0) 15.0

Growth in other expenses 12.0 15.0 8.0 15.0

Slippages 1.8 1.8 2.4 2.5

Treasury gain/(loss) (% of investments) 69.5 70.0 68.0 70.0


Exhibit 14: Change in estimates

Particulars (` cr)

FY2012 FY2013

Earlierestimates

Revisedestimates

% chgEarlier

estimatesRevised

estimates% chg

NII 6,611 6,725 1.7 7,414 7,621 2.8

Non-interest income 2,013 2,013 - 2,302 2,302 -

Operating income 8,624 8,737 1.3 9,716 9,923 2.1

Operating expenses 3,982 3,928 (1.4) 4,579 4,517 (1.4)

Pre-prov. profit 4,642 4,809 3.6 5,136 5,406 5.2

Provisions & cont. 1,370 1,886 37.6 1,429 1,989 39.2

PBT 3,272 2,924 (10.6) 3,707 3,417 (7.8)Prov. for taxes 1,062 949 (10.6) 1,203 1,109 (7.8)

PAT 2,210 1,975 (10.6) 2,504 2,308 (7.8)


Exhibit 15: P/ABV band


0

100

200

300

400

500

O c t - 0 2

M a y - 0

3

D e c - 0

3

J u l - 0 4

F e b - 0

5

S e p - 0

5

A p r - 0 6

N o v - 0

6

J u n - 0

7

J a n - 0

8

A u g - 0

8

M a r - 0 9

O c t - 0 9

M a y - 1

0

D e c - 1

0

J u l - 1 1

F e b - 1

2

Price (`) 0.8x 1.1x 1.4x 1.7x 2x






October 28, 2011 8

Exhibit 16: Recommendation summary

Company Reco.CMP

(`)Tgt. price

(`)Upside

(%)FY2013EP/ABV (x)

FY2013ETgt. P/ABV (x)

FY2013EP/E (x)

FY2011-13EEPS CAGR (%)

FY2013ERoA (%)

FY2013ERoE (%)

AxisBk Buy 1,152 1,414 22.7 1.9 2.3 10.1 17.7 1.5 20.0

FedBk Accumulate 411 444 8.0 1.1 1.2 8.4 19.5 1.2 14.0

HDFCBk Neutral 483 497 2.9 3.3 3.4 16.8 30.5 1.7 20.9

ICICIBk* Buy 933 1,102 18.1 1.7 2.0 13.5 24.1 1.4 15.6

SIB Neutral 23 24 4.4 1.1 1.2 6.8 15.6 1.0 18.2

YesBk Accumulate 315 347 10.2 2.0 2.2 10.5 19.9 1.3 20.8

AllBk Buy 145 16916.4 0.7 0.8 4.1 8.9 0.9 17.7

AndhBk Neutral 118 1190.7 0.8 0.8 5.3 (0.9) 0.9 15.8

BOB Buy 739 871 17.9 1.0 1.2 5.6 10.6 1.1 19.6

BOI Accumulate 324 362 11.6 0.9 1.0 5.4 15.2 0.7 17.1

BOM Accumulate 50 55 10.7 0.7 0.7 4.3 38.1 0.6 16.5

CanBk Neutral 461 463 0.5 0.9 0.9 5.4 (2.8) 0.9 17.1CentBk Reduce 105 99 (5.1) 0.7 0.7 5.2 (14.6) 0.5 14.2

CorpBk Buy 415 489 17.9 0.7 0.8 4.2 2.3 0.8 16.8

DenaBk Neutral 76 74 (2.4) 0.6 0.6 3.7 5.8 0.8 16.2

IDBI# Neutral 114 115 1.4 0.7 0.8 5.4 12.3 0.7 14.0

IndBk Accumulate 205 220 7.1 0.8 0.9 5.3 0.2 1.1 17.4

IOB Neutral 98 96 (1.4) 0.6 0.6 3.9 20.3 0.6 15.9

J&KBk Neutral 819 820 0.1 0.9 0.9 5.7 6.7 1.2 16.4

OBC Neutral 305 314 3.2 0.7 0.7 5.3 5.4 0.8 13.9

PNB Accumulate 962 1,085 12.9 1.1 1.3 6.0 7.2 1.0 20.0

SBI* Buy 1,907 2,267 18.9 1.4 1.7 7.3 41.4 1.0 21.9

SynBk Accumulate 109 123 12.4 0.7 0.8 4.8 11.8 0.7 16.3

UcoBk Reduce 71 66 (7.0) 0.9 0.8 4.3 14.0 0.6 16.5

UnionBk Accumulate 222 238 7.3 0.8 0.9 5.1 5.2 0.8 17.0

UtdBk Accumulate 74 82 10.7 0.6 0.7 4.4 11.7 0.6 13.8

VijBk Neutral 56 53(4.9) 0.8 0.7 6.8 (3.2) 0.4 10.5

Source: Company, Angel Research; Note:*Target multiples=SOTP Target Price/ABV (including subsidiaries), #Without adjusting for SASF






October 28, 2011 9

Income statement

Y/E March (` cr) FY08 FY09 FY10 FY11 FY12E FY13E

NII 3,086 3,814 4,192 6,216 6,725 7,621

- YoY Growth (%) 10.6 23.6 9.9 48.3 8.2 13.3Other Income 1,233 1,483 1,975 2,039 2,013 2,302

- YoY Growth (%) 46.4 20.3 33.2 3.2 (1.3) 14.4

Operating Income 4,319 5,296 6,167 8,255 8,737 9,923

- YoY Growth (%) 18.9 22.6 16.4 33.9 5.8 13.6

Operating Expenses 1,593 2,214 2,508 3,950 3,928 4,517

- YoY Growth (%) 7.9 39.0 13.3 57.5 (0.6) 15.0

Pre - Provision Profit 2,726 3,082 3,659 4,305 4,809 5,406

- YoY Growth (%) 26.4 13.1 18.7 17.6 11.7 12.4

Prov. & Cont. 866 725 826 1,350 1,886 1,989

- YoY Growth (%) 11.6 (16.2) 13.9 63.3 39.7 5.5

Profit Before Tax 1,860 2,357 2,833 2,955 2,924 3,417

- YoY Growth (%) 34.8 26.7 20.2 4.3 (1.1) 16.9

Prov. for Taxation 473 630 758 873 949 1,109

- as a % of PBT 25.4 26.7 26.8 29.6 32.4 32.4

PAT 1,387 1,727 2,075 2,082 1,975 2,308

- YoY Growth (%) 64.1 24.5 20.2 0.3 (5.1) 16.9

Balance sheet

Y/E March (` cr) FY08 FY09 FY10 FY11 FY12E FY13E

Share Capital 505 505 505 635 635 635Reserves & Surplus 6,843 8,235 9,919 12,129 13,667 15,446

Deposits 103,859 138,703 170,040 202,461 238,904 281,907

- Growth (%) 21.9 33.5 22.6 19.1 18.0 18.0

Borrowings 4,760 3,885 3,125 7,126 8,409 9,922

Tier 2 Capital 3,750 4,890 6,090 6,190 7,242 8,546

Other Liab & Prov. 4,356 4,757 5,483 7,443 9,604 12,128

Total Liabilities 124,073 160,976 195,162 235,984 278,462 328,585

Cash balances 9,455 8,992 12,468 17,610 15,529 18,324

Bank balances 643 6,993 3,308 2,488 5,569 6,572

Investments 33,822 42,997 54,404 58,399 73,120 86,375

Advances 74,348 96,534 119,315 150,986 176,654

- Growth (%) 19.2 29.8 23.6 26.5 17.0 18.0

Fixed Assets 2,201 2,335 2,305 2,293 2,624 3,004

Other Assets 3,604 3,124 3,361 4,208 4,965 5,859

Total Assets 124,073 160,976 195,162 235,984 278,462 328,585

- Growth (%) 21.1 29.7 21.2 20.9 18.0 18.0






October 28, 2011 10

Ratio analysis

Y/E March FY08 FY09 FY10 FY11 FY12E FY13E

NIMs 2.8 2.8 2.4 3.0 2.7 2.6

Cost to Income Ratio 36.9 41.8 40.7 47.8 45.0 45.5RoA 1.2 1.2 1.2 1.0 0.8 0.8

RoE 26.8 27.2 26.2 20.9 16.6 17.0

B/S ratios (%)

CASA Ratio 34.9 30.1 31.7 31.8 31.3 30.8

Credit/Deposit Ratio 71.6 69.6 70.2 74.6 73.9 73.9

CAR 12.5 11.2 11.7 12.0 12.6 11.4

- Tier I 7.5 6.9 7.4 8.1 8.2 7.3

Asset Quality (%)

Gross NPAs 2.2 2.0 2.2 2.4 3.4 4.0

Net NPAs 0.8 0.3 0.8 1.2 1.4 1.5

Slippages 1.2 1.6 1.8 2.4 2.4 2.5

Loan Loss Prov./Avg. Assets 0.5 0.4 0.4 0.6 0.6 0.6

Provision Coverage 63.7 83.1 74.0 67.6 68.0 70.0

Per Share Data (`)EPS 27.5 34.2 41.1 39.6 37.5 43.8

ABVPS 107.6 139.7 173.6 203.3 230.0 2

DPS 4.0 5.0 5.5 8.0 7.0 8.5

Valuation Ratios

PER (x) 8.1 6.5 5.4 5.6 5.9 5.1

P/ABVPS (x) 2.1 1.6 1.3 1.1 1.0 0.8

Dividend Yield 1.8 2.3 2.5 3.6 3.2 3.8

DuPont Analysis (%)

NII 2.7 2.7 2.4 2.9 2.6 2.5

(-) Prov. Exp. 0.8 0.5 0.5 0.6 0.7 0.7

Adj. NII 2.0 2.2 1.9 2.3 1.9

Treasury 0.3 0.2 0.3 0.2 0.1 0.1

Int. Sens. Inc. 2.2 2.4 2.2 2.5 2.0 1.9

Other Inc. 0.8 0.8 0.8 0.7 0.7 0.7

Op. Inc. 3.0 3.2 3.0 3.2 2.7 2.6

Opex 1.4 1.6 1.4 1.8 1.5 1.5

PBT 1.6 1.7 1.6 1.4 1.1 1.1Taxes 0.4 0.4 0.4 0.4 0.4 0.4

RoA before pref. div. 1.2 1.2 1.2 1.0 0.8 0.8

Pref. div. - - - 0.0 0.0 0.0

RoA 1.2 1.2 1.2 1.0 0.8 0.8

Leverage (x) 21.9 22.5 22.5 21.7 21.7 22.5

RoE 26.8 27.2 26.2 20.9 16.6 17.0

I S I E m e r g i n g M a r k e t s P D F u s - m c k i n

D o w n l o a d e d b y u s - m c k i n s e y 1 f r o m




October 28, 2011 11

Research Team Tel: 022 - 39357800 E-mail: [email protected] Website: www.angelbroking.com

DISCLAIMER

This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investmentdecision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make

such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies

referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and

risks of such an investment.

Angel Broking Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, make

investment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in this

document are those of the analyst, and the company may or may not subscribe to all the views expressed within.

Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and

trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's

fundamentals.

The information in this document has been printed on the basis of publicly available information, internal data and other reliablesources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as thisdocument is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report .

Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify,nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. While Angel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory,compliance, or other reasons that prevent us from doing so.

This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced,

redistributed or passed on, directly or indirectly.

Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or

other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in

the past.

Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in

connection with the use of this information.

Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please refer to thelatest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Limited and its affiliates may haveinvestment positions in the stocks recommended in this report.

Disclosure of Interest Statement Union Bank of India

1. Analyst ownership of the stock No

2. Angel and its Group companies ownership of the stock No

3. Angel and its Group companies' Directors ownership of the stock No

4. Broking relationship with company covered No

Ratings (Returns): Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)Reduce (-5% to 15%) Sell (< -15%)

Note: We have not considered any Exposure below`

1 lakh for Angel, its Group companies and Directors


Documents

Union Bank of India-2QFY2012RU