CUB - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 4.0

📊 Fundamental Analysis of City Union Bank Ltd (CUB)

City Union Bank is a well-established private sector bank with a strong regional presence and consistent profitability. It offers a stable long-term investment profile, though not without some limitations

ROE (12.6%) & ROCE (6.86%): Moderate returns, acceptable for a conservative banking play.

Debt-to-Equity (6.94): High, typical for banks, but manageable due to strong asset quality.

PEG Ratio (0.98): Fairly valued relative to growth.

EPS (₹15.7) vs P/E (13.6): Reasonable earnings and valuation.

Dividend Yield (0.94%): Modest, but consistent.

📈 Technical & Valuation Insights

Current Price: ₹214

52-Week Range: ₹143 – ₹233

DMA 50 / DMA 200: ₹205 / ₹183 — trading above both, indicating bullish momentum

RSI (55.2): Neutral zone

MACD (0.96): Positive, suggesting upward trend

Volume: Strong, indicating active interest

🟢 Ideal Entry Price Zone

Based on technical support and valuation

₹190 – ₹205: Ideal accumulation zone near 50 DMA and historical support

₹175 – ₹185: Deep value zone if broader market corrects

Avoid fresh entry above ₹225 unless supported by strong earnings momentum.

📈 Long-Term Outlook

Price Targets

2025: ₹220 – ₹263

1

2026: ₹225 – ₹302

2

2027: ₹309 – ₹414

3

2030: ₹440 – ₹627

2

Growth Drivers

Expansion beyond Tamil Nadu into underbanked regions

4

Digital transformation and operational efficiency

Stable asset quality and cost-to-income ratio

Risks

Net interest margin pressure

Rising deposit costs

Slower savings account growth

🛑 Exit Strategy (If Already Holding)

If you're already invested

Holding Period: 3–5 years to capture full growth cycle

Exit Triggers

ROE drops below 10% for 2+ quarters

Price exceeds ₹300 without EPS growth — consider partial profit booking

Asset quality deteriorates (Net NPA > 2%)

Trailing Stop-Loss: ₹190 to protect downside

🧠 Final Verdict

City Union Bank is a stable, moderately undervalued banking stock with a solid long-term outlook. Ideal for accumulation near ₹190–₹205 with a 3–5 year horizon. If holding, stay invested and monitor quarterly earnings, asset quality, and ROE trends.

Would you like a comparison with peers like Federal Bank or Karur Vysya Bank to explore alternatives in the same segment?

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dailybulls.in

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shareprice-target.com

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bing.com

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www.tickertape.in

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