Shares of UCO Bank fell nearly 3 per cent on Tuesday, snapping their two-day winning run amid heavy volumes. The stock slipped 4.46 per cent to hit an intraday low of Rs 31.10 over its previous close of Rs 32.55. The scrip eventually settled 2.61 per cent lower at Rs 31.70 on BSE.
At today’s closing level of Rs 31.70, the public sector lender’s stock traded 16.91 per cent lower from its 52-week high of Rs 38.15, touched on December 16 last year.
An analyst said the counter could be seen facing resistance starting from Rs 32 to Rs 44-odd zone, while another suggested Rs 33.5 level as a strong resistance zone.
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Osho Krishan, Senior Analyst – Technical & Derivative Research at Angel One, said, “UCO Bank has witnessed a vertical rally from the level of Rs 14.50 and has gained over 130 per cent in the last couple of trading weeks. The stock has surged in line with the rally in PSU banks and has generated a massive return in a nudge of a time. The trend seamlessly has changed, but post such a rally one should not rule out the potential of cool-off or correction in the counter.
Krishan further stated that the support base has slightly moved upwards towards the Rs 24-odd zone. “At present, the stock has a cluster of resistance at the higher zone starting from Rs 32 to Rs 44-odd zone. Looking at the recent price action, the stock is likely to continue its northward journey, but one needs to remain cautious in the counter and should trail profits with strict trailing stop loss,” he added.
Jigar S Patel, Senior Manager – Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, “UCO Bank is trading well above its 12-, 26- & 50-DEMA (Double exponential moving average), which further confirms an upside in coming sessions. One can buy around Rs 31-32 for an expected target of Rs 36 and the stop loss would be placed at Rs 27.
AR Ramachandran from Tips2trades said, “UCO Bank has strong resistance at Rs 33.5. The stock price is in a bearish to a sideways trend. A daily close below Rs 30 could lead to Rs 26.5 in the coming days.”
Around 47.93 lakh shares changed hands today on BSE, which was higher than UCO Bank’s two-week average volume of 33.16 lakh shares. Turnover on the counter stood at Rs 15.33 crore, commanding a market capitalisation (m-cap) of Rs 37,900.39 crore.
The counter’s 14-day relative strength index (RSI) came at 57.95. 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 31.12.
The stock traded higher than 5-day, 20-, 50-, 100- and 200-day moving averages. UCO Bank has a one-year beta of 0.69, suggesting low volatility.
The PSU lender is yet to report its earnings for the December 2022 (Q3 FY23) quarter. In the September quarter (Q2) of the current fiscal, UCO Bank reported a more than two-fold jump in its net profit at Rs 504.52 crore as a fall in bad loans resulted in lesser provisioning requirements.
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It had reported a net profit of Rs 205.39 crore in the corresponding quarter a year ago. The Kolkata-headquartered lender’s total income, in Q2 FY23, rose to Rs 4,964.84 crore from Rs 4,655.86 crore in the same period of 2021-22. Interest income during Q2 FY23 rose to Rs 4,184.89 crore from Rs 3,719.79 crore.
Meanwhile, Indian equity benchmarks rose sharply today, led by gains in consumer goods, energy and technology stocks. The 30-share BSE Sensex pack jumped 563 points or 0.94 per cent to settle at 60,656; while the broader NSE Nifty index moved 158 points or 0.89 per cent higher to finish at 18,053.
