Previews: Oriental Bank of Commerce, UCO Bank, Corporation Bank, Indian Bank ::Angel Broking,

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Oriental Bank of Commerce
Oriental Bank of Commerce is scheduled to announce its 2QFY2012 results. The
bank’s NII is expected to decline by 4.7% yoy (flat qoq) to `1,026cr. Other income
is expected to increase by healthy 19.0% yoy to `255cr. Operating expenses are
expected to increase by 10.4% yoy (decline 0.9% qoq) to `536cr and pre-provision
profit is expected to decline by 7.6% yoy and 7.1% qoq to `745cr. We expect the
bank’s net profit growth to decline by 18.5% yoy (sequential decline of 8.6%) to
`324cr. The bank has already switched over accounts worth `10lakhs and above
to system-based NPA recognition. The remaining transformation had to be
completed by September 2011, the effect of which is expected to show in
2QFY2012 results. At the CMP, the stock is trading at 0.7x FY2013E P/ABV. We
recommend a Neutral rating on the stock.

Indian Bank
Indian Bank is scheduled to announce its 2QFY2012 results. The bank is expected
to post net interest income growth of 6.1% yoy to `1,043cr. Non-interest income is
expected to decline by 8.5% yoy to `259cr. Operating expenses are expected to
decline by 3.3% yoy (up 2.5% sequentially) to `511cr. Pre-provision profit is
expected to increase by 7.2% yoy to `792cr. The bank has already switched over
all its accounts to system-based NPA recognition and, hence, we expect a
sequential 4.3% decline (up 27.3% yoy) in provisioning expenses to `169cr. Net
profit is expected to increase marginally by 1.2% yoy (up 3.4% qoq) to `421cr. At
the CMP, the stock is trading at valuations of 0.8x FY2013E ABV. We maintain our
Accumulate view on the stock with a target price of `220.

Corporation Bank
Corporation Bank is slated to announce its 2QFY2012 results. We expect
calculated NIM to remain flat sequentially and consequently expect net interest
income to register marginal 1.7% qoq growth for 2QFY2012. Other income is
expected to increase strongly by 33.1% yoy to `301cr. On a yoy basis, preprovision
profit is expected to register only moderate growth of 3.0% yoy, as
operating expenses are expected to rise by 16.8% yoy. Provisioning expenses are
expected to increase sharply by 40.8% yoy (decline of 17.8% qoq) to `137cr,
resulting in a marginal decline of 0.8% in net profit to `349cr. At the CMP, the
stock is trading at 0.7x FY2013E ABV. We have a Buy rating on the stock with a
target price of `489.

UCO Bank
UCO Bank is expected to announce its 2QFY2012. We expect the bank to report a
20.6% yoy decline in its net interest income to `795cr. Non-interest income,
however, is expected to post growth of 8.4% yoy to `249cr. Operating income is
expected to decline by 15.2% yoy. Operating expenses are expected to decline by
4.8% yoy (up 6.2% qoq) to `502cr. Due to a higher decline in operating income

than operating expenses, the bank’s cost-to-income ratio is expected to deteriorate
to 48.1% compared to 42.8% in 2QFY2011. The bank has only switched over
accounts worth `50lakhs and above to system-based NPA recognition. The
remaining transformation had to be completed by September 2011, the effect of
which is expected to show in 2QFY2012 results. Provisioning expenses are
expected to increase by 6.9% qoq (down 42.9% yoy due to a high base) to `331cr.
Net profit is expected to increase by 59.3% yoy (down 35.1% qoq) to `190cr. At
the CMP, the stock is trading at 0.9x FY2013E ABV. We recommend a Reduce
rating on the stock with a target price of `66.