Any current/future capex/capital investment/strategic investment?

IT budget for FY26 approved at over Rs.1,000 crore; spend increased from Rs.576 crore in FY24 to Rs.899 crore in FY26. Ongoing and planned projects under digital transformation (Project Parivartan Phase 2): - Omnichannel banking experience. - Cash management services. - Supply chain finance. - Robotic process automation. - Digital marketing solutions. - Forex and prepaid card solutions. - Document management system. - E-note facility to remove paper from the system. - Cybersecurity improvements including identity access management and centralized log management. - Conversio

Future growth expectations in sales/revenue/volumes?

UCO Bank projects credit growth guidance for FY27 at 12-14%, continuing a consistent trend over the years, despite past achievements exceeding targets (19.44% actual growth in FY26). Deposit growth guidance remains steady at 10-12%, with a focus on retail franchise (savings, current accounts) over bulk deposits. CASA ratio guidance stays at 37-38%, with actual CASA at 38.65% and ongoing efforts to increase CASA and net interest margin. The bank aims to improve ROA from 0.87% toward 0.95-1% by end of next financial year through enhanced NIM, CASA growth, and TWO recovery. Digital initiatives (P

Future growth expectations in earnings/operating earnings/profits/EPS?

Guidance for FY27 includes: - Credit growth target: 12-14%, consistent with past years' guidance. - Deposit growth: 10-12%. - CASA ratio: Maintain 37-38%. - RAM segment growth: 62-65%. - CD ratio: 80-82%. - Credit cost targeted below 0.75% (improved from previous). - NIM (global): 2.8-2.9%. - Gross NPA expected under 2%, Net NPA under 0.2%. - Slippage ratio expected below 1%. - Recovery and upgradation target at Rs. 2,000 to 2,500 crore. ROA is expected to improve, aiming to near 0.95-1% by FY27 end. Initiatives to improve ROA include focus on net interest margin, CASA grow

Current/ Expected Orderbook/ Pending Orders?

The current pipeline in the Corporate segment is around Rs. 14,000 crore. Certain sanctions are already in place, but disbursement is delayed due to pricing issues. The bank is cautious about credit growth in the Corporate segment and does not want to compromise on margins. Growth demand is coming from sectors like renewables, data centers, smart metering, and road projects. The bank focuses on acquiring business in "sunshine sectors" while maintaining pricing discipline.

Any current/future new fundraising through debt or equity?

No immediate plans for equity fundraising; QIP approval has been obtained from the Board but no launch is planned in the current quarter. (Page 9) The bank will wait for the right market opportunity before proceeding with QIP. (Page 9) Regarding debt, there is no explicit mention of new debt fundraising plans in the transcript. However, discussions around credit growth and deposit focus indicate ongoing management of liabilities. (Pages 9-11) No specific future fundraising through debt or equity detailed beyond the QIP approval status.

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UCO BankQ1 FY26Banks

UCO Bank Q1 FY26 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹26P/E: 11.4Market Cap: ₹31.6K CrSector: Banks

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Order

N/A

Capex

Yes

1 of 4 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 3

→UCO Bank projects credit growth guidance for FY27 at 12-14%, continuing a consistent trend over the years, despite past achievements exceeding targets (19.44% actual growth in FY26).
→Deposit growth guidance remains steady at 10-12%, with a focus on retail franchise (savings, current accounts) over bulk deposits.
→CASA ratio guidance stays at 37-38%, with actual CASA at 38.65% and ongoing efforts to increase CASA and net interest margin.
→The bank aims to improve ROA from 0.87% toward 0.95-1% by end of next financial year through enhanced NIM, CASA growth, and TWO recovery.
→Digital initiatives (Project Parivartan) expand digital business, improving customer engagement and loan product penetration.
→Credit pipeline of Rs.14,000 crore in Corporates focuses on renewables, data centers, smart metering, and roads but pricing discipline is maintained.
→Treasury activity is expected to benefit from global environment stability leading to improved profitability.

Margin guidance

Category 3

→Guidance for FY27 includes:
→ - Credit growth target: 12-14%, consistent with past years' guidance.
→ - Deposit growth: 10-12%.
→ - CASA ratio: Maintain 37-38%.
→ - RAM segment growth: 62-65%.
→ - CD ratio: 80-82%.
→ - Credit cost targeted below 0.75% (improved from previous).
→ - NIM (global): 2.8-2.9%.
→ - Gross NPA expected under 2%, Net NPA under 0.2%.
→ - Slippage ratio expected below 1%.
→ - Recovery and upgradation target at Rs. 2,000 to 2,500 crore.
→ROA is expected to improve, aiming to near 0.95-1% by FY27 end.
→Initiatives to improve ROA include focus on net interest margin, CASA growth, and TWO recovery.
→Cost-to-income ratio expected to improve with continued focus on fee income and cost control.
→No explicit EPS targets disclosed, but overall performance and growth trends indicate positive earnings momentum.

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Fundraise plans

→No immediate plans for equity fundraising; QIP approval has been obtained from the Board but no launch is planned in the current quarter. (Page 9)
→The bank will wait for the right market opportunity before proceeding with QIP. (Page 9)
→Regarding debt, there is no explicit mention of new debt fundraising plans in the transcript. However, discussions around credit growth and deposit focus indicate ongoing management of liabilities. (Pages 9-11)
→No specific future fundraising through debt or equity detailed beyond the QIP approval status.

Order book

→The current pipeline in the Corporate segment is around Rs. 14,000 crore.
→Certain sanctions are already in place, but disbursement is delayed due to pricing issues.
→The bank is cautious about credit growth in the Corporate segment and does not want to compromise on margins.
→Growth demand is coming from sectors like renewables, data centers, smart metering, and road projects.
→The bank focuses on acquiring business in "sunshine sectors" while maintaining pricing discipline.

Capex plans

Yes

→IT budget for FY26 approved at over Rs.1,000 crore; spend increased from Rs.576 crore in FY24 to Rs.899 crore in FY26.
→Ongoing and planned projects under digital transformation (Project Parivartan Phase 2):
→ - Omnichannel banking experience.
→ - Cash management services.
→ - Supply chain finance.
→ - Robotic process automation.
→ - Digital marketing solutions.
→ - Forex and prepaid card solutions.
→ - Document management system.
→ - E-note facility to remove paper from the system.
→ - Cybersecurity improvements including identity access management and centralized log management.
→ - Conversion of call center into profit center.
→ - Centralized monitoring for credit loans via ED CAM portal.
→ - Transformation Management vertical headed at GM level.
→ - Additional WhatsApp banking services.
→ - CASA back office and centralized forex processing center.
→Completion of key previous initiatives like CBDC on mobile, new treasury solution (Murex), data center consolidation.

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