Posted on April 1, 2025, by Niftynews
UCO Bank share price took a significant hit on April 1, 2025, dropping 14% and hitting a one-year low of ₹30.90 per share during the day. The stock was last trading at ₹31.48, reflecting an 11.92% loss on the day. Over the past six months, the UCO Bank share price has dropped by 34.50%, raising concerns among investors and analysts.
The decline follows the bank’s recent announcement regarding the closure of its Qualified Institutional Placement (QIP) issue, which closed last week. While the QIP was aimed at raising funds, the sharp drop in share price indicates investor skepticism about the bank’s future prospects.
What Happened with UCO Bank’s QIP Issue?
On March 27, 2025, UCO Bank informed the stock exchanges that it had successfully closed its QIP issue, raising nearly ₹2,000 crore by issuing 583.6 million equity shares. Notably, Life Insurance Corporation of India (LIC) and the National Pension System (NPS) Trust were the largest subscribers to the issue, collectively acquiring over 47% of the total shares issued.
While this capital infusion was expected to strengthen the bank’s financial position, it appears that the market has reacted negatively to the increased equity base, leading to a significant drop in share value. The issue price of ₹34.27 per share, though higher than the current market price, might not have been enough to convince investors to buy into the stock.
Analysts’ View on UCO Bank Share Price: Bearish Outlook Ahead
Several technical analysts have expressed concerns about the UCO Bank stock, with many predicting a bearish outlook in the short term. The UCO Bank share price is currently in a corrective phase, and experts suggest that it could remain weak for the foreseeable future.
- Osho Krishan, Senior Research Analyst at Angel One, noted that UCO Bank is displaying inherent weakness and is likely to face resistance between the ₹34.40-35.40 range. He believes the stock could find support around ₹30 in the near term.
- Jigar S Patel, Senior Manager at Anand Rathi, agreed with this assessment, saying that support for the stock lies at ₹30, while resistance could be found at ₹34.5. A decisive move above ₹34.5 could trigger a further rally toward ₹37, though he expects the stock to trade between ₹30 and ₹37 for the short term.
- Ameya Ranadive, Senior Technical Analyst at StoxBox, pointed out that UCO Bank shares are showing a persistent downtrend, positioning the stock as a “sell-on-rise” candidate. Multiple resistance zones are evident on the charts, indicating selling pressure at higher levels.
Government’s Stake and Market Context
As of December 2024, the government held a dominant 95.39% stake in UCO Bank, a factor that may offer some stability to the bank’s operations. However, in light of the poor stock performance, analysts are wary of the bank’s near-term recovery.
UCO Bank’s poor performance is part of a larger trend affecting public sector banks (PSBs), with other major banks like Central Bank of India, Indian Overseas Bank, and Union Bank of India also experiencing declines. The Nifty PSU Bank index slipped 0.31% to 6,243.70 on the same day, reflecting the broader pressure on public sector financial institutions.
What’s Next for UCO Bank Shareholders?
For current shareholders, it’s crucial to closely monitor the UCO Bank share price over the coming weeks. The short-term outlook remains bearish, and analysts recommend watching for any signs of stabilization or a potential recovery. If the stock continues to face resistance at key levels, investors may want to reassess their positions.
If you’re considering investing in UCO Bank, it might be wise to wait until the stock shows signs of a more sustainable recovery. As always, consider consulting with a financial advisor before making any investment decisions.
