Union Bank of India

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

Union Bank of India trades at ₹180, in a confirmed uptrend and 72 weeks into that stage. That is +5.7% against its own 200-day average. It sits at 58% of a 52-week range of ₹150 to ₹202. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 8 straight weeks.

Today the stock is in a confirmed uptrend — week 72 of stage 2, confirmed. At ₹180 it trades +5.7% versus its 200-day average and sits at 58% of its 52-week range (₹150–₹202).

Against the market, two honest reads. Cumulative: over the last 10.6 years the stock moved +66% while the NIFTY 500 moved +268% — behind the index over the full window. Recent form: on a trailing-13-week view the stock has been ahead for 8 straight weeks — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

Story check

Union Bank of India's story is not scored yet against the markers our research file set on 22 August 2026. Where it sits in its own cycle: MID_CONTRACTION. Still open: A reversion of Gross NPA above 4.0% or a sustained deterioration in Net Interest Margin below 2.45% that drives Return on Equity below 11.0%.

Our read, 22 August 2026. Union Bank of India is executing a structural transition from wholesale PSU lending toward a retail, agriculture, and MSME mix while eliminating high-cost bulk deposits to defend net interest margins and sustain return on equity above 15%.

From the numbers. The current weekly P/B engine places Union Bank at 0.9x book, 2.25x its 0.4x weekly-engine median and at the 76th percentile. The deterministic 40-quarter curve ends at 1.0x book, with a 0.5x median and an…

From the price. Price stage 2, week 72 — above its 200-day line, relative strength rising.

From the research. Union Bank of India is executing a structural transition from wholesale PSU lending toward a retail, agriculture, and MSME mix while eliminating high-cost bulk deposits to defend net interest margins and sustain return…

🚨 Where they disagree. RIDING_WAVE.

What is proven. Union Bank of India is executing a structural transition from wholesale PSU lending toward a retail, agriculture, and MSME mix while eliminating high-cost bulk deposits to defend net interest margins and sustain return on equity above 15%.

What is not proven yet. A reversion of Gross NPA above 4.0% or a sustained deterioration in Net Interest Margin below 2.45% that drives Return on Equity below 11.0%.

🚨 What would change our mind. A reversion of Gross NPA above 4.0% or a sustained deterioration in Net Interest Margin below 2.45% that drives Return on Equity below 11.0%.

Layer 1 read, 22 August 2026 — KEEP. Profit is rising because funding got cheaper, not because provisions were released — but the re-rating is already done. Union Bank earned 27.4% more in the June quarter on income that barely moved, and the reason is the cost side: it shed 70,000 crore of deposits costing 7.70% and refunded itself at 4.70%, lifting current-account and savings deposits to 35.21%. Bad loans have kept falling, from 6.38% to 3.06% gross. The catch is price: at 1.0 times book value the shares sit at the 86th percentile of their own ten-year range after more than quadrupling off the trough, and the 15.7% return on equity being capitalised is itself near the top of the bank's own band, so most of the repair is already paid for.

What would change Layer 1’s mind. Net interest margin recovering to 2.68% or better by the December quarter while gross bad loans fall under 2.70% would show the deposit repricing is still ahead of the rate cuts and would take this to P1. What flips it the other way, sharpening the timeline's own kill line: gross bad loans back above 4.0%, or margin held below 2.55% for two straight quarters so that return on equity falls under 11% — at 1.0 times book with the multiple already at the 86th percentile, there is no valuation…

Layer 2 read, 22 August 2026 — BENCH. The bank is repaired, but the easy funding gain is temporary and the lasting regulatory cost is still ahead. Union Bank replaced expensive bulk deposits with cheaper funding, which directly lowered its interest bill. The sector review confirms that deposit repricing is the current margin support, but says it runs out while the new expected-credit-loss cost remains. High provision cover reduces the danger, so BENCH is more proportionate than DROP.

What would change Layer 2’s mind. ADVANCE if the first full quarter after deposit repricing has largely run its course still shows sequential margin improvement, because that would disprove the expiry risk in sector claim Q15.

The test written in advance. A reversion of Gross NPA above 4.0% or a sustained deterioration in Net Interest Margin below 2.45% that drives Return on Equity below 11.0%. — the thesis as written as stated by the next result.

The test written in advance. ECL Transition Provisioning Requirements — ECL Transition Provisioning Requirements Regulatory notification requiring full upfront capital deduction without phase-in dispensations. by the next result.

The test written in advance. Deposit Growth Lagging Credit Expansion — Deposit Growth Lagging Credit Expansion Domestic credit-deposit ratio exceeding 84% or deposit growth remaining below 8% in FY27. by the next result.

What the company does. Asset quality cleanup is largely accomplished, with Gross NPA down to 2.82% and Net NPA to 0.48%, backed by a 95.13% provision coverage ratio. Deliberate shedding of ₹70,000 Cr in bulk deposits costing 7.70% and expansion of CASA to 35.21% at 4.70% incremental cost buffers margin compression from rate cuts. Valuation at 0.9x to 1.0x book value is above the historical median and requires delivered return on equity of about 15% to justify it.

🚨 What the surface reading misses. The surface reading is: FY26 revenue was broadly flat versus FY25 while net profit increased to ₹19,430 Cr. The research reads it further: Annual revenue increased only from ₹106,600 Cr to ₹106,799 Cr, while net profit increased from ₹18,027 Cr to ₹19,430 Cr. The result therefore shows earnings expansion without material annual revenue growth; it does not by itself establish recurring operating leverage.

🚨 What the surface reading misses. The surface reading is: The Dec 2025 quarterly row shows low reported Gross NPA of 3.06% and Net NPA of 0.51%. The research reads it further: The December figures improved from 3.29% Gross NPA and 0.55% Net NPA in September 2025. The subsequent Q4 call reported further improvement to 2.82% Gross NPA and 0.48% Net NPA, so the direction remained favorable through the latest management update.

Sources: our stock research file (22 August 2026) · quarterly results through Jun 26 · the company’s own earnings calls. The story check is re-scored every results season; the record below never changes.

Revenue For a bank, revenue is everything the franchise earns — interest on the loan book plus fee and other income.

Union Bank of India reported ₹27,427 Cr of income in the Jun 26 quarter, +1.2% year on year. Over 10 years it has compounded at 12.7% a year. The last full year, FY26, came in at ₹1,06,799 Cr. The last four reported quarters add to ₹1,07,127 Cr.

Why this happened. Following the deliberate shedding of sub-hurdle corporate loans, the bank has built a corporate pipeline of ₹50,000 to ₹60,000 Cr. Deployment is intended to be selective and management reports that 95% of corporate advances are rated BBB+ or higher, supporting the 13% to 14% FY27 credit-growth guidance without relaxing stated risk filters.

FY26 revenue came in at ₹1,06,799 Cr (+0.2% on the year), capping 10 years at 12.7% compound. The latest quarter (Jun 26) printed ₹27,427 Cr, +1.2% year on year.

Pace check: the last four quarters averaged −1.3% growth against the decade's 12.7% — the current year is running slower than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew −1.3% over the last 4 quarters against +1.8%/yr over the last 8 — rolling over; TTM profit +9.7% vs +20.7%/yr — rolling over.

FY26-Q4. revenue ₹26,676 Cr and profit ₹5,504 Cr as reported.

FY27-Q1. revenue ₹27,427 Cr and profit ₹5,642 Cr as reported.

Why-sources: our stock research file (22 August 2026) and the company’s own results for those quarters.

Net margin Net margin — what the bank keeps of every ₹100 of revenue after every cost, provision and tax. It is the cleanest single margin we can read for a lender.

Union Bank of India's net margin is 20.6% in the Jun 26 quarter, +4.3 percentage points against the same quarter a year ago. That is the widest this company has ever printed on a full-year basis. Across 13 fiscal years the net margin has ranged −15.8% to 18.2%. The current quarter is running above every full year in that window.

Why this happened. Applying the Predictable Repricing Catalyst model, the bank eliminated ₹70,000 Cr of volatile bulk deposits over FY26, funding the balance sheet through ₹46,000 Cr of alternative resources: treasury reallocation of ₹25,000 Cr, refinancing of ₹18,000 Cr, and infrastructure bonds of ₹3,000 Cr. CASA ratio expanded by 270 bps to 35.21%, and combined CASA plus retail term deposits reached 79% of total deposits. The 4.70% incremental cost of funds provides a path for lower funding cost as legacy term deposits reprice.

The latest quarter's net margin is 20.6%, +4.3 pp against the same quarter a year ago. Across 13 fiscal years the net margin has ranged −15.8%–18.2%, and FY26's 18.2% is the top of that band — a record year.

Why: the numbers show the net margin move clearly, but the cost lines behind it sit below what we hold — so we state the move without inventing its driver.

Worth repeating from the valuation section: cheap against its own history on record margins is not the same thing as cheap — a record margin flatters every ratio built on top of it.

FY26-Q4. revenue ₹26,676 Cr and profit ₹5,504 Cr as reported.

FY27-Q1. revenue ₹27,427 Cr and profit ₹5,642 Cr as reported.

Why-sources: our stock research file (22 August 2026) and the company’s own results for those quarters.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

Union Bank of India earned ₹5,642 Cr of net profit in the Jun 26 quarter, +27.4% year on year. It is the 3rd consecutive quarter of growth. Full-year FY26 profit was ₹19,430 Cr. The 10-year compound rate is 30.6%. That is 20.6% of the quarter's revenue. The same quarter a year earlier earned ₹4,428 Cr.

Jun 26 profit was ₹5,642 Cr, +27.4% year on year — the 3rd consecutive quarter of growth. On the full year, FY26 printed ₹19,430 Cr (+7.8%), and the 10-year compound rate is 30.6%.

Why profit moved: revenue contributed +1.2% and the margin +4.3 pp — the quarter was margin-led: most of the profit growth came from keeping more of each sale.

Pace comparison, last four quarters: profit +10.0% vs revenue −1.3%. Profit is growing faster than sales — fixed costs are being spread over a bigger base, and each extra rupee of revenue drops more to the bottom line.

FY26-Q4. revenue ₹26,676 Cr and profit ₹5,504 Cr as reported.

FY27-Q1. revenue ₹27,427 Cr and profit ₹5,642 Cr as reported.

Why-sources: our stock research file (22 August 2026) and the company’s own results for those quarters.

Asset quality — the ladder Gross NPA is the slice of the loan book where repayments have stopped. Net NPA is what remains after the money already set aside against those loans. Falling is healing; rising is damage arriving.

Union Bank of India's gross NPA is 3.06% of the loan book in Dec 25, down from 3.85% a year ago. Net of provisions already set aside, 0.51% remains. That is the 9th straight quarter of improvement. Across the 10 quarters held here the book has ranged 3.06% to 6.38%.

Dec 25: gross NPA at 3.06% and net NPA at 0.51%, against 3.85% / 0.82% a year ago. Over the 10 quarters we hold, the book's worst reading was 6.38% and its best is 3.06% — which is the current print. The ladder has now improved for 9 consecutive quarters.

The synthesis: profit growth at a bank is only as good as the book behind it, and this book is healing on a multi-quarter streak. A note on depth: quarterly provisioning detail is not in our numbers yet, so this ladder reads levels and trend, not the cost of the cleanup.

Why the ladder moved: recoveries, write-offs and slippages each play a part, and that split sits below what we hold — the numbers show the healing; the driver mix does not travel with them.

The loan book We read the loan book through revenue — when the book grows, revenue grows with it. It is a rough proxy, and we say so: rate moves and fee swings can shift it a few points in any one year.

Union Bank of India's revenue grew +0.2% in FY26 to ₹1,06,799 Cr, so the book is growing. The latest quarter ran +1.2% year on year. The net margin on that income is 20.6%, +4.3 percentage points against a year ago. Interest income is a proxy for the book; rate moves can shift it a few points in any one year.

Why this happened. Management is actively executing the Value Chain Climb model by reallocating balance sheet capacity from low-yield corporate advances to higher-spread retail, agri, and MSME assets. RAM advances grew 12.56% YoY in FY26, led by retail at 16.75% and MSME at 18.75%. Corporate advances below 6% yield were intentionally shed by ₹30,000 Cr. This reallocation seeks to elevate portfolio yield while management reports that 99% of retail exposures have credit scores above 700.

FY26 revenue was ₹1,06,799 Cr, +0.2% on the year, and the latest quarter ran +1.2% year on year. The net margin on that revenue is 20.6% this quarter (+4.3 pp YoY) — growth with a widening margin on it.

The synthesis: a lender compounds when the book grows while the margin holds and the loan book stays clean — gross NPA is the loan-quality read we carry here.

Returns on equity and assets Two numbers rate a bank: ROE — what it earns on shareholder money — and ROA — what it earns on everything it deploys. ROE above ~13–15% earns its keep; below that, growth builds book slowly.

Union Bank of India earns a return on equity of 16% in FY26. Its trough over the ladder below was −21% in FY18. On the asset side every ₹100 of the balance sheet earned about ₹1.35, which is the return before leverage is applied.

FY26 ROE came in at 16%, recovered from a FY18 trough of −21%. On assets, the latest reading is about 1.35% — every ₹100 the bank deploys earns roughly ₹1.35 a year. That clears the bar a bank must beat for its book value to compound.

Why ROE moved: profit compounded 30.6% a year over 10 years while the equity base grew more slowly — earnings recovering faster than book value builds is what lifts ROE off a trough.

Debt

For a bank, borrowings are raw material, not a warning sign — solvency is read through the returns and the loan book. A manufacturer’s debt is a claim against its profits, so the debt-to-equity lens that works everywhere else misleads on a lender and is not applied here.

A manufacturer’s debt is a claim against its profits; a bank’s borrowings are its inventory — money taken in to be lent out. The debt lens that works everywhere else misleads here, so this page does not apply it. The solvency questions for a bank — is the loan book sound, is the equity earning — are read through the loan-book and returns sections above.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Foreign institutions added 1.3 points of Union Bank of India over 8 quarters, the biggest move on the register. That takes foreign institutions to 8.6% of the company. Domestic institutions moved +0.6 points over the same window, to 12.0%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Foreign institutions: +1.3 points over 8 quarters to 8.6%; Domestic institutions: +0.6 points over 8 quarters to 12.0%; Promoters: +0.0 points over 8 quarters to 74.8%.

Why the register moved: foreign institutions drove it (+1.3 points), alongside domestic institutions (+0.6 points) — steady accumulation by institutions reading the same numbers this page reads.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

Union Bank of India: the Z-score is omitted — it was built for manufacturers, not banks, and applying it here would be theatre. The Z-score was built for manufacturers and is not applied to banks and lenders, so solvency here is read from the capital and asset-quality lines instead.

The safety line in one sentence: the Z-score is omitted — it was built for manufacturers, not banks, and applying it here would be theatre.

Valuation For a bank we price the book, not the earnings: P/BV is what the market pays for each ₹1 of the bank's net worth. A bank below 1× book is priced below the value of what it owns, net of what it owes.

Union Bank of India trades at 0.9× P/BV, at the pricey end of its own range (83rd percentile). Its long-run median P/BV is 0.4×, measured across 10.6 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/BV of 0.9× is at the pricey end of its own range (83rd percentile), against a long-run median of 0.4× measured over 10.6 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

🚨 Why the multiple sits where it does: over the past year book value grew while the price moved +34.4% — the price ran ahead of the book, pushing the multiple up its own range.

The price move, decomposed: over 5y, of the +39.1%/yr price move, ~+16.0%/yr came from book-value growth and ~+23.1 pp from the multiple (expanding); over 10y, of the +2.2%/yr price move, ~−5.7%/yr came from book-value growth and ~+7.9 pp from the multiple (expanding). The split is the honest approximate (price return minus book-value growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is full against its own past, so the story rests on the book-value line underneath it, not the multiple.

What the price assumes This reading works the multiple backwards. It asks one question: what yearly rate of profit growth is a buyer at the market price already paying for? The number is the growth rate that makes eleven years of profit — six years growing, then five fading — add up to that day's market price, once each year is discounted at 11% a year.

Solved at its 26 August 2026 price, Union Bank of India was paying for profit growth of about −0.7% a year. Profit itself has compounded 30.6% a year over the past 10 years. Today the market pays 0.9× P/BV, the 83rd percentile of its own 11-year range.

What the two numbers say together. The multiple is full against its own past, and the growth the price is paying for is below what this company has actually delivered.

How to hold this number: it is a reading of one day's price, taken on 26 August 2026, not a running figure — every other number on this page, the multiple included, is read off the live quote as of 28 September 2026. A higher price is paying for more growth and a lower price for less, so it moves whenever the price does, and this page does not restate it between measurements.

Stage: Topping out Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

Union Bank of India reads as topping out on its fundamental arc. Topping out — profit and EPS growth have decelerated hard (profit growth +96.4% at its peak → +9.7% latest) while ROE still reads 14.8%. The read is built from 12 quarters across 4 curves, on full evidence.

Why it matters: decelerating from a peak is where good stories quietly end — the multiple usually notices late.

4-Factor Sector Score

59.6/100 — rank 1 of 3 in PSU Banks · 91% evidence confidence

Union Bank of India scores 59.6 out of 100 against the 3 companies it is compared with in PSU Banks, ranking 1. Price leads the evidence: RS versus the benchmark is 9.2%, but earnings trajectory is weak. Wait for revenue and profit confirmation.

The four contributions add to the total exactly: 12.7 + 17.4 + 13.9 + 15.6 = 59.6. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if ROA rolls over or gross NPA rises while sector-relative strength deteriorates.

Said versus delivered

What Union Bank of India's management promised, set against what actually arrived — 4 tracked promises on the record. Read straight from the company’s own earnings calls. A promise that slipped stays on this page after it is met.

PSLC Income Return Guidance Abandoned · 23 April 2026. In both prior calls, management confidently guided that PSLC income would return to approximately FY25 levels (~950 crores) in FY27. The Oct 2025 ED stated 'at least that kind of quantum would be possible from next year,' and the Jan 2026 ED reiterated confidence in booking 'a good amount of profit' from PSLC going forward. In the Apr 2026 call, FY26 PSLC income came in at only ~120 crores, and FY27 guidance has retreated to a vague 'we will assess the portfolio to determine the strategy for next year' — a direct reversal of the prior confident FY25-level return commitment. Later call (Apr 2026): “We will assess the portfolio to determine the strategy for next year.”

Credit Cost Forward Guidance Jumped ~4x · 23 April 2026. In the Jan 2026 call, the CFO explicitly guided ~26 bps credit cost going forward, consistent with the 9-month FY26 actuals and confirming 'we would like to try and achieve that kind of a number going forward.' However, in the Apr 2026 call, when directly asked whether the 23 bps FY26 credit cost is sustainable, management shifted to stating they 'generally guide for a 1% credit cost' — roughly four times the Jan 2026 stated target — without explaining what materially changed in the risk outlook, given that all key asset quality metrics (GNPA, SMA levels, CIBIL scores, corporate ratings) continued to improve through Q4 FY26. Earlier call (Jan 2026): “if you look at our 9-month credit cost is about 26 bps, right, so what sir is indicating is, we would like to try and achieve that kind of a number going forward.” Later call (Apr 2026): “While we don”.

🚨 Missed Growth Guidance · 14 January 2026. In the October 2025 call, management explicitly stated that the bank would achieve system-level loan growth "here onwards" and aspired to perform even better than the system immediately. However, in the January 2026 call, the bank reported single-digit advances growth of 7.13% (lagging the broader system) and reverted to aspirational language about merely "moving toward" industry levels, contradicting the immediate convergence promised earlier. Earlier call (Oct 2025): “Here onwards you will see the system level growth which is happening in the Bank also... But we are aspiring even better than the system level for quarter-to-quarter here onwards.” Later call (Jan 2026): “Gross advances increasing by 7.13%... We are moving toward the industry growth levels as our aspiration.”

Treasury Income Volatility · 14 January 2026. The July 2025 call guided for a significant moderation in treasury income, with management stating that the strong performance seen in Q1 would likely not be repeated. Contradicting this bearish outlook, the January 2026 call revealed a 45% sequential increase in investment interest income, driven by active churning and HTM sales that management had previously suggested would not be a recurring trend. Earlier call (Jul 2025): “That trend, I don”. Later call (Jan 2026): “We contracted the treasury book by 15,000 crores... The treasury income includes foreign exchange, HTM sales, and mutual fund income.”

Every quote above is taken word for word from the company’s own earnings calls.

Frequently asked questions