UCO Bank Q1: PBT jumps 172%, but ₹1,237 Cr tax-regime one-off caps PAT at ₹656 Cr
PAT +8.05% YoY · revenue +8.7% · margins expanding
₹6,996 Cr
+8.7% YoY
₹656.32 Cr
+8.05% YoY
7.56%
-0.6pp YoY
₹0.52
UCO Bank's Q1 FY27 standalone headline — net profit ₹656 Cr, up 8.05% YoY and down 18% QoQ — badly understates the quarter. The muted growth is almost entirely a one-time ₹1,237.13 Cr charge to the P&L from remeasuring deferred tax assets as the bank moved to the concessional Section 115BAA tax regime from FY27, which pushed the tax line to ₹1,919 Cr (from ₹335 Cr a year ago). Strip that out and PAT would be roughly ₹1,893 Cr. The undistorted read: pre-tax profit ₹2,575 Cr, +172% YoY, and operating profit ₹2,810 Cr, +79.8% YoY.
Q1 FY-2027 vs prior quarters
The operating engine did the work. Net interest income rose 16.9% to ₹2,808 Cr and global NIM improved 9 bps YoY to 3.05%, while other income jumped ~70% to ₹1,686 Cr — lifted by ₹1,018 Cr of recovery in written-off accounts (11.7% of total income). Operating margin expanded to 32.4% from 21.0% a year ago; non-tax provisions actually fell to ₹235 Cr from ₹616 Cr as slippages eased. Net profit margin optically compressed to 7.56% (from 8.17%), but that sits entirely on the tax line, not on operations.
The stock went into the print at ₹25.88, down 4.5% over the past month of trading.
For context: revenue is at a 6-quarter high.
What the summary numbers don't show
EPS ₹0.52 (vs ₹0.48 YoY, ₹0.64 QoQ, not annualised)
Management guides for continued robust performance in FY27, targeting 12-14% credit growth and 10-12% deposit growth, while aiming to further improve asset quality with Gross NPA below 2% and Net NPA below 0.2%. The bank will maintain a global Net Interest Margin between 2.8-2.9% and increase the share of its high-grow
— This quarter: met
The print confirms the confident tone management struck on the Q4 call. Total business crossed ₹6.05 lakh crore, +15.5% YoY, tracking the 12-14% credit / 10-12% deposit guidance; asset quality improved to GNPA 2.08% (from 2.63%) and NNPA 0.25% (from 0.45%), landing just shy of the stated sub-2%/sub-0.2% targets, with PCR at 92.85%. RoA of 0.68% annualised is depressed by the tax charge, leaving the 1% RoA goal still in progress. Management framed performance as "positive," and the operating numbers agree even as the reported PAT hides it. No formal street PAT consensus surfaced for this name. On governance, the board invoked Clause 14A to approve results directly as the audit committee lacked quorum (auditors noted it; opinion unmodified), and ED Rajendra Kumar Saboo holds additional charge as MD & CEO.
W1
Reported PAT normalization from Q2 as the ₹1,237 Cr tax one-off lapses under the new 115BAA regime — pre-tax run-rate implies ~₹1,800-1,900 Cr
W2
Global NIM holding above 3.05% vs management's 2.8-2.9% guidance band
W3
Durability of other income after ₹1,018 Cr written-off recovery; and last leg of asset-quality goal (GNPA to sub-2%, NNPA to sub-0.2%)
Standalone only (PSU bank, no consolidated). Source in Lakh, converted to Cr. Interest Earned used as revenueFromOperations; totalExpenses = total expenditure incl non-tax provisions (₹235 Cr), ex-tax. MAJOR ONE-OFF: ₹1,237.13 Cr one-time deferred-tax charge (Note 12, switch to Sec 115BAA regime from FY27) inflated tax provision to ₹1,919 Cr and held reported PAT to +8% YoY despite PBT +172%. Also ₹552.24 Cr IFR moved to General Reserve (balance-sheet only); ₹4.46 Cr SR revaluation profit in P&L. Board invoked Clause 14A — audit committee not constituted for want of quorum (auditors flagged, opinion unmodified).
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