Union Bank IPO

dhamm · 1 Union Bank IPO Wed Feb 09, 2011 11:34 am

dhamm

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Guys, what do you all think about the union bank IPO? Has anyone done a valuation for it? pls share your views..
Thanks.

milanka · 2 Prospectus not out yet Wed Feb 09, 2011 12:31 pm

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Prospectus not out yet !! My broker said may be this eveing or Tomorrow the books would be available... Also we may be able to download from CSE site tomoro..!

dhamm · 3 Re: Union Bank IPO Wed Feb 09, 2011 12:33 pm

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milanka, its available on their site. pls follow following link.

http://www.unionb.com/UnionBankProspectus.pdf

econ · 4 Re: Union Bank IPO Wed Feb 09, 2011 2:07 pm

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NAVPS - 12
EPS annualized = 0.63

issue price - 25
total shares after issue - 348 million
PB ratio - 25/12 , around 2
PER ratio - 25/0.63 - around 39
ROE - 5.5%
NPL ratio - 7.22%

considering all those for me UNION Bank IPO is not that undervalued.

tkc · 5 Union Bank IPO Wed Feb 09, 2011 5:18 pm

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What are your ideas about this ? Smile

watch · 6 Re: Union Bank IPO Wed Feb 09, 2011 6:44 pm

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I think specially IPO shares cannot be valued considering normal ratios.econ is correct. it is not undervalued.
also In IPO situation SFIN is not undervalued. but share up up.......
on attraction of finance sector union bank share can be doubled. better to aware about over subscription rate.

smallville · 7 Re: Union Bank IPO Wed Feb 09, 2011 6:59 pm

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econ wrote:NAVPS - 12
EPS annualized = 0.63

issue price - 25
total shares after issue - 348 million
PB ratio - 25/12 , around 2
PER ratio - 25/0.63 - around 39
ROE - 5.5%
NPL ratio - 7.22%

considering all those for me UNION Bank IPO is not that undervalued.

econ,
NAVPS @ 12, PBV @ 2.02 (25/12) seem good know? Why u said its overvalued?
We cant go by the normal EPS valuation for a bank know?
Also ROE is lower, so I think we can give it a fair value..

SilverHawk · 8 Re: Union Bank IPO Wed Feb 09, 2011 7:18 pm

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smallville wrote:

econ wrote:NAVPS - 12
EPS annualized = 0.63

issue price - 25
total shares after issue - 348 million
PB ratio - 25/12 , around 2
PER ratio - 25/0.63 - around 39
ROE - 5.5%
NPL ratio - 7.22%

considering all those for me UNION Bank IPO is not that undervalued.

econ,
NAVPS @ 12, PBV @ 2.02 (25/12) seem good know? Why u said its overvalued?
We cant go by the normal EPS valuation for a bank know?
Also ROE is lower, so I think we can give it a fair value..

Book value is one measure, but EPS also important, bcos ultimately all matters whether they are performing or not for value we are paying for shares.

econ · 9 Re: Union Bank IPO Wed Feb 09, 2011 7:33 pm

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smallville wrote:

econ wrote:NAVPS - 12
EPS annualized = 0.63

issue price - 25
total shares after issue - 348 million
PB ratio - 25/12 , around 2
PER ratio - 25/0.63 - around 39
ROE - 5.5%
NPL ratio - 7.22%

considering all those for me UNION Bank IPO is not that undervalued.

econ,
NAVPS @ 12, PBV @ 2.02 (25/12) seem good know? Why u said its overvalued?
We cant go by the normal EPS valuation for a bank know?
Also ROE is lower, so I think we can give it a fair value..

yes we do not use just PER for banking valuation. that's why I gave several ratios..
PBV is good but NPL ratio is 7.22% . which is I think quite high. I did not check other banks though. ROE is 5.5% and EPS is quite low compare with other growing banks like NTB,NDB etc.

milanka · 10 Private Placement Infor. Wed Feb 09, 2011 8:43 pm

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The private placement of Union Bank has triggered significant response with the issue closing yesterday.

Union Bank offered 12.5 million shares via the unique private placement incorporating a tender basis and a book building process. The minimum bid was Rs. 26 per share.

Sources said that the placement had received bids as high as Rs. 34 per share whilst the biggest application was at Rs. 30 per share. Previously 7.5 million shares were placed with a foreign institutional shareholder at Rs. 28 each, bringing the total offered via private placements to 20 million shares.

Source : ft.lk 28th Dec 2010.

smallville · 11 Re: Union Bank IPO Wed Feb 09, 2011 8:58 pm

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Thanks SilverHawk & Econ.. Given the fact that this is a financial institute.. I think we can expect a run for at least 35-40... Food for thought ;-)

mono · 12 Re: Union Bank IPO Thu Feb 10, 2011 12:41 am

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SilverHawk wrote:

smallville wrote:

econ wrote:NAVPS - 12
EPS annualized = 0.63

issue price - 25
total shares after issue - 348 million
PB ratio - 25/12 , around 2
PER ratio - 25/0.63 - around 39
ROE - 5.5%
NPL ratio - 7.22%

considering all those for me UNION Bank IPO is not that undervalued.

econ,
NAVPS @ 12, PBV @ 2.02 (25/12) seem good know? Why u said its overvalued?
We cant go by the normal EPS valuation for a bank know?
Also ROE is lower, so I think we can give it a fair value..

Book value is one measure, but EPS also important, bcos ultimately all matters whether they are performing or not for value we are paying for shares.

banks are about how much capital you have. If you have enough capital at your disposal future earning will come naturally. Why are all these institutional buyers offering 30 for the private placement if this is not fairly valued?

econ · 13 Re: Union Bank IPO Thu Feb 10, 2011 4:01 am

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mono wrote:

SilverHawk wrote:

smallville wrote:

econ wrote:NAVPS - 12
EPS annualized = 0.63

issue price - 25
total shares after issue - 348 million
PB ratio - 25/12 , around 2
PER ratio - 25/0.63 - around 39
ROE - 5.5%
NPL ratio - 7.22%

considering all those for me UNION Bank IPO is not that undervalued.

econ,
NAVPS @ 12, PBV @ 2.02 (25/12) seem good know? Why u said its overvalued?
We cant go by the normal EPS valuation for a bank know?
Also ROE is lower, so I think we can give it a fair value..

Book value is one measure, but EPS also important, bcos ultimately all matters whether they are performing or not for value we are paying for shares.

banks are about how much capital you have. If you have enough capital at your disposal future earning will come naturally. Why are all these institutional buyers offering 30 for the private placement if this is not fairly valued?

mono > yes true..
but union bank was lack of capital some time ago.. that's why they went for aggressive rights issues,private placements.. they were far behind the central bank capital requirement.

dhamm · 14 Re: Union Bank IPO Thu Feb 10, 2011 9:03 am

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Thank you all for your contribution. Smile

milanka · 15 UB - Investor Categories. Thu Feb 10, 2011 4:51 pm

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Category A – Employees of UBC - preferential allocation
Category B – Customers of UBC - The Bank will notify the customers with
regard to the preferential allocation and eligibility through press notification.
Category C – Other Investors - No preferential allocation - Normal procedure.

Gaja · 16 Re: Union Bank IPO Thu Feb 10, 2011 4:55 pm

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Also they bought 51% of National Asset Management Ltd

milanka · 17 NAMAL Purchase by UB. Thu Feb 10, 2011 6:01 pm

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@Gaja : You are correct.
Source : news360.lk

Milford Holdings Private Limited has decided to sell the 70% of the stake it holds in the National Asset Management Limited’s issued capital to the Union Bank and Ennid Capital Private Limited.
Under the agreement 51% of the shares would be purchased by the Union Bank while 19% will be purchased by the Ennid Capital Private Limited.

gamaya · 18 IPO Fri Feb 11, 2011 5:24 pm

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The big fish would quote quote higher prices at private placement to exit with massive capital gain after IPO. Now I think SEC has brought in rules to prevent this. Just may be the bidders didn't knew this coming. This seems overvalued to me at PER 39 and its coming out at a time of credit clearance.

fair investor · 19 Re: Union Bank IPO Fri Feb 11, 2011 11:59 pm

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The most interesting parts for me in a bank are deposit base,non performing loan ratio and the equity base

Gaja · 20 Re: Union Bank IPO Sun Feb 13, 2011 9:15 am

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http://www.sundaytimes.lk/110213/BusinessTimes/bt02.html

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Union Bank IPO

1 Union Bank IPO Wed Feb 09, 2011 11:34 am

dhamm

2 Prospectus not out yet Wed Feb 09, 2011 12:31 pm

milanka

3 Re: Union Bank IPO Wed Feb 09, 2011 12:33 pm

dhamm

4 Re: Union Bank IPO Wed Feb 09, 2011 2:07 pm

econ

5 Union Bank IPO Wed Feb 09, 2011 5:18 pm

tkc

6 Re: Union Bank IPO Wed Feb 09, 2011 6:44 pm

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7 Re: Union Bank IPO Wed Feb 09, 2011 6:59 pm

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8 Re: Union Bank IPO Wed Feb 09, 2011 7:18 pm

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9 Re: Union Bank IPO Wed Feb 09, 2011 7:33 pm

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10 Private Placement Infor. Wed Feb 09, 2011 8:43 pm

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11 Re: Union Bank IPO Wed Feb 09, 2011 8:58 pm

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12 Re: Union Bank IPO Thu Feb 10, 2011 12:41 am

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13 Re: Union Bank IPO Thu Feb 10, 2011 4:01 am

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14 Re: Union Bank IPO Thu Feb 10, 2011 9:03 am

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15 UB - Investor Categories. Thu Feb 10, 2011 4:51 pm

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16 Re: Union Bank IPO Thu Feb 10, 2011 4:55 pm

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17 NAMAL Purchase by UB. Thu Feb 10, 2011 6:01 pm

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