Shares of Union Bank of India tanked 10 percent after the bank reported disappointing March-quarter (Q4) earnings and CLSA and Credit Suisse cut the stocks target price for a 12-month period. The bank's net loss widened to Rs 3,370 crore in the fourth quarter of 2018-19, mainly on account of higher provisioning. The company had registered a net loss of Rs 2,583.38 crore in the same quarter of the preceding fiscal.

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The stock fell as much as 9.9 percent to hit the intraday low of Rs 71.35 per share on the BSE. At 12:30 PM, the stock was trading 8.6 percent lower at Rs 72.4 as compared to a 0.5 percent (178 points) rise in BSE Sensex at 37,496.

While CLSA retained its 'buy' call on the stock for a reasonable valuation and better CASA franchise, however, the brokerage cut its target to Rs 105 from Rs 96 per share. The brokerage said that it was disappointed by high slippages and larger than expected losses. The bank will need capital support given lower capital adequacy, it added.

Meanwhile, Credit Suisse reiterated a 'neutral' rating with a revised target of Rs 75 from Rs 78 per share previously. The brokerage also cut the bank's EPS estimate by 13 percent for FY20-21.

Citi, on the other hand, which had a 'sell' call on the stock, raised its target price to Rs 70 from Rs 65 per share. While divergence in NPA was low, that in provisions was higher, it added. Citi slashed its FY20-21 estimates by 16 percent on higher provisions.

As part of the risk-based supervision as per RBI directive, the bank has reported divergence in gross NPAs of Rs 867 crore in 2017-18; divergence in net NPA of (-) Rs 1,414 crore and divergence in provisioning stood at Rs 2,281 crore. The adjusted net loss during 2017-18 came at Rs 6,770 crore.

Union Bank said its cash recovery and upgradation during 2018-19 increased by 188.5 percent to Rs 6,447 crore as against Rs 2,235 crore in 2017-18.

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First Published:May 15, 2019 10:48 AM IST