Union Bank of India Share Price Drops on Weak Q1 Business Update

Market Performance

Union Bank of India's share price came under pressure during the early trade session on Wednesday, following a tepid Q1 business update for FY25.

• The stock plunged as much as 5.8%, hitting an intraday low of ₹141.54 on the NSE.
• Around 10:40 am, it was trading at ₹143.74, down 4.33% from the previous close.
• Over the last three trading sessions, the stock has declined by nearly 7%.

Main News

The drop in share price was triggered by the bank's subdued quarterly business performance, especially on key growth parameters such as loan book and deposit growth.

• Loan Book:
  • Grew 6.8% year-on-year in Q1 FY25
  • Stood at ₹22.1 lakh Crore as of June-end
  • Compared to ₹21.08 lakh Crore in the same quarter last year
  • This marks the slowest growth in four quarters and the fourth straight quarter of single-digit expansion
• Deposits:
  • Rose 3.63% YoY, reaching ₹12.39 lakh Crore
  • From ₹11.96 lakh Crore a year earlier
  • This is the sixth consecutive quarter of single-digit deposit growth

Company Details

Union Bank of India, one of the central public sector banks in the country, has faced moderating growth momentum in its key operational metrics over recent quarters.

The latest figures indicate challenges in accelerating both credit disbursement and deposit mobilization, which could weigh on near-term investor sentiment.

Summary

Union Bank of India's share price took a hit after releasing a weak business update for Q1 FY25. The lender reported its slowest loan book growth in a year, at 6.8%, while deposit growth remained muted for the sixth consecutive quarter, at 3.63%. This lackluster performance has led to a nearly 7% drop in stock value over three days, with Wednesday's trade seeing an intraday fall of 5.8%.