Bank of America-Merrill Lynch upgrades Union Bank of India to 'buy' from 'underperform' after the state-run lender reported a surge in July-September earnings on Friday.
BoA-ML says asset quality was far better than expected, and adds: We believe the worst is behind us.
The investment bank calls Union Bank its top pick among government- run banks, says earnings to improve on the back of lower credit costs, while margins are showing signs of stability.
BoA-ML also raises its price objective on the stock to 270 rupees from 175 rupees.
Union Bank shares down 1.4 percent at 220.00 rupees as of 0758 GMT after surging 15.7 percent over the previous three sessions.
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