You've probably noticed it. The stock price of union bank (NSE: UNIONBANK) has been behaving like it’s on a mission lately. Just this week, it hit a 52-week high of ₹180.69, leaving a lot of retail investors scratching their heads and wondering if they missed the bus.
Honestly, the banking sector in India is usually a bit of a snooze-fest unless something goes catastrophically wrong. But Union Bank is telling a different story right now. On January 14, 2026, the stock surged over 8% in a single session. That doesn't happen by accident. It happened because the bank dropped its Q3 FY26 results, and they were, well, surprisingly solid.
What’s Actually Driving the Price?
It’s all about the "clean-up." For years, public sector banks (PSUs) were the problem children of the Indian stock market. They had bad loans piled up to the ceiling. But Union Bank has been aggressively scrubbing its balance sheet.
Managing Director Asheesh Pandey recently pointed out something pretty gutsy. The bank deliberately shed about ₹40,000 crore in "bulk deposits." These are high-cost deposits that basically eat into a bank's profits. By letting them go, they actually improved their margins.
The Net Interest Margin (NIM) climbed to 2.91% this quarter. That’s a huge win. When a bank can earn more on the money it lends while paying less for the money it keeps, investors start salivating.
The Profit Picture
Let’s look at the raw numbers from the December quarter.
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- Net Profit: Jumped to ₹5,017 crore.
- Asset Quality: Gross NPA (Non-Performing Assets) fell to 3.06%.
- Net NPA: This is the kicker—it dropped to 0.51%.
Basically, the bank is getting healthier. It’s like watching someone finally commit to a gym routine and actually seeing the results. The market is rewarding that discipline.
Stock Price of Union Bank: The "White Marubozu" Factor
Technical analysts have been pointing at a "White Marubozu" pattern on the charts. It sounds like a character from a Japanese anime, but it’s actually a very bullish candlestick pattern. It indicates that the buyers were in total control from the opening bell to the close.
When you see this kind of momentum combined with high trading volumes—we’re talking over 88 million shares in a day—it usually suggests that big institutional "whales" are moving in.
But is it too late to buy?
Brokerages are split, as they always are. Investec recently upgraded their target to ₹195. Meanwhile, some others like Emkay are staying a bit more cautious, keeping a "Neutral" stance even after raising their target prices. They're worried about whether the bank can keep growing its "CASA" (Current Account Savings Account) ratio in a competitive market.
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The US Tariff Wildcard
Here is something most people are ignoring. During the recent earnings call, the management mentioned that about 500 clients have been impacted by US tariffs. This is a real-world macro pressure that could affect the stock price of union bank if those businesses struggle to pay back loans.
The bank has already started disbursing relief under a special RBI dispensation, but it’s a small amount so far—around ₹258 crore. It’s a tiny fraction of their ₹10.17 lakh crore loan book, but it’s the kind of detail that separates a smart investor from someone just following the hype.
Dividends and Your Wallet
If you’re a "buy and hold" type, the dividend yield is sitting around 2.65% to 2.7%. For the 2025 fiscal year, they paid out ₹4.75 per share. It’s not going to make you rich overnight, but for a PSU bank, it’s a decent "thank you" for staying invested.
What Most People Get Wrong
People think PSU banks are just slow-moving giants. They assume Union Bank will always trade at a massive discount compared to HDFC or ICICI.
While it’s true that private banks usually get higher valuations, the gap is closing. Union Bank is currently trading at a P/E ratio of roughly 7.2. Compare that to the sector average of 12.14, and you realize the stock is still technically "cheap" relative to its peers.
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The risk?
Banking is sensitive. If the RBI holds interest rates at 5.25% for too long, or if the global economy catches a cold, these gains can evaporate.
Actionable Strategy for Investors
If you’re looking at the stock price of union bank today, don't just FOMO (Fear Of Missing Out) into it because of a green candle.
- Watch the ₹165-₹170 level: This was the previous resistance. If the price dips back here and holds, it might be a safer entry point than buying at the absolute peak.
- Monitor the RAM growth: Keep an eye on the Retail, Agriculture, and MSME (RAM) segment. It grew by 11.5% this quarter. This is the "safe" lending that protects the bank from corporate blowouts.
- Check the Budget: With the Union Budget coming up on February 1, 2026, PSU stocks always get volatile. Expect some swings.
- Verify the ECL impact: The bank has noted a ₹4,200 crore gap for the new "Expected Credit Loss" (ECL) system starting in April. This is a one-time hit to their reserves that you need to be prepared for.
The bottom line is that Union Bank has finished its "repair" phase and is moving into "growth" mode. It’s no longer just a "cheap stock"—it’s a bank that’s starting to act like it wants to lead the PSU pack.