Shares of City Union Bank tanked in Monday’s trade after announcing the December quarter (Q3 FY23) results. The stock slumped 16.75 per cent to hit a day low of Rs 133.20 over its previous close of Rs 160. The private sector lender reported a net profit of Rs 217.84 crore for Q3 FY23, down 21.20 per cent quarter-on-quarter (QoQ) from Rs 276.45 crore in Q2 FY23. City Union Bank’s profit in Q3 FY22 came at Rs 196.12 crore.
The bank’s net interest income (NII) also slipped 2 per cent, sequentially, to Rs 555.70 crore in Q3 FY23 from Rs 567.90 crore in Q2 FY23. In addition, City Union Bank’s net interest margin (NIM) declined 21 basis points (bps) to 3.90 per cent.
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Technical charts hinted that support on the counter could be seen between Rs 110 and 120 zones, followed by Rs 125.25 level.
Sneha Seth, Derivatives Research Analyst at Angel One, said, “City Union Bank has been under selling pressure since mid of December series, today this counter has plunged on account of the Q3 result announcement. Technically, this counter looks to be under a corrective phase and follow-up selling can drag it towards the multiyear support zone placed around Rs 110-120 odd levels. On the upside, Rs 155-160 should now act as a sturdy hurdle for the short term.”
AR Ramachandran from Tips2trades said, “Below average Q3FY23 results have led to a sharp fall in City Union Bank stock price. A daily close below Rs 148 today could lead to a further fall till the next support of Rs 125.25.”
The stock was last seen trading lower than 5-day, 20-, 50-, 100- and 200-day moving averages. The counter’s 14-day relative strength index (RSI) came at 23.35. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company’s stock has a price-to-equity (P/E) ratio of 12.76.
That said, City Union Bank has an average target price of Rs 227.30, Trendlyne data showed, suggesting a potential upside of 70.39 per cent. The scrip has a one-year beta of 1.05, indicating average volatility on the counter.
Around 6.29 lakh shares changed hands today on BSE, which was more than seven times higher than City Union Bank’s two-week average volume of 82,000 shares. Turnover on the counter stood at Rs 8.85 crore, commanding a market capitalisation (m-cap) of Rs 10,028.54 crore. There were 17,46,287 sell orders today against buy orders of 3,62,318 shares.
In terms of operations, City Union Bank has 752 branches across 16 states and three Union Territories (UTs).
Meanwhile, Indian equity benchmarks fell sharply in late deals today, dragged by banks, financials, automobile, metals and technology stocks.
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