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Synopsis: Three stocks, including two PSU banks, Union Bank of India and Bank of India, along with Syrma SGS Technology Ltd, experienced significant declines in Monday's trading session. Bank of India's shares dropped by 12.35% to Rs 121.70, Union Bank saw an 8.2% decline to Rs 130.40, and Syrma SGS Technology Ltd tumbled by 11.93% to Rs 415.35. The market reaction stemmed from disappointment over their March quarter results.
Three stocks, including two PSU banks, Union Bank of India and Bank of India, along with Syrma SGS Technology Ltd, experienced significant declines in Monday's trading session. Bank of India's shares dropped by 12.35% to Rs 121.70, Union Bank saw an 8.2% decline to Rs 130.40, and Syrma SGS Technology Ltd tumbled by 11.93% to Rs 415.35. The market reaction stemmed from disappointment over their March quarter results.
Amid the market downturn, Union Bank reported a 19% YoY earnings growth despite a 4% drop in operating profit, attributed to a significant decrease in provisions by 57% YoY. Return ratios remained steady, with RoA at 1% and RoE at 14%. Kotak Institutional Equities expressed confidence in Union Bank's asset quality improvements, retaining its recommendation to 'ADD' with a Fair Value (FV) of Rs 155.
On the other hand, Syrma SGS Technology experienced mixed performance, with its Q4 Ebitda margin improving sequentially but declining by 222 bps YoY. ICICI Securities attributed the margin decline to a focus on high volume-based automotive and consumer business with relatively lower margins and higher input prices. However, the brokerage remains optimistic about margin recovery in FY25 and FY26, despite revising its target on the stock downwards to Rs 600 from Rs 675.
Morgan Stanley reportedly advised an 'underweight' call on Bank of India, citing higher slippages sequentially and increased credit costs, despite Q4 core pre-provision operating profit growth exceeding estimates. The brokerage set a target of Rs 124 on the stock. However, it's worth noting that Business Today couldn't independently verify this media report.
Disclaimer: We provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.
Related Questions
1. Which stocks experienced significant declines in Monday's trading session?
Union Bank of India, Bank of India, and Syrma SGS Technology Ltd experienced significant declines in Monday's trading session.
2. What was the percentage drop in Bank of India's shares?
Bank of India's shares dropped by 12.35%.
3. What were the key highlights of Union Bank's earnings report?
Union Bank reported a 19% YoY earnings growth despite a 4% drop in operating profit, attributed to a significant decrease in provisions by 57% YoY. Return ratios remained steady, with RoA at 1% and RoE at 14%.
4. What was the reason behind the margin decline in Syrma SGS Technology?
ICICI Securities attributed the margin decline in Syrma SGS Technology to a focus on high volume-based automotive and consumer business with relatively lower margins and higher input prices.
5. What was Morgan Stanley's recommendation for Bank of India?
Morgan Stanley advised an 'underweight' call on Bank of India, setting a target of Rs 124 on the stock.
