Religare is a global financial services group. It has been advised by Religare Capital Markets to subscribe to IPO (initial public offering) of United Bank of India for registering gains.

UBI a Kolkata-headquartered bank has fixed price of its Initial Public Offering at 0.8x post-diluted ABV as at the end of Sep 2009. Although the below-average operating performance of bank are grounds for concern, the absolute valuation discount in respect of peers like Allahabad Bank, Dena Bank and Andhra Bank guides us to rate the issue as Subscribe. [smartads]

It is believed that there could be gains of 10 to 15 % on the United Bank of India issue; though a continued upside to valuations would pivot on the ability of management to strengthen operating parameters.

United Bank of India’s IPO of 50 million shares holds a price band of Rs 60 to 66 per share. The government investment in the bank would reduce from 100 percent to 84.2 percent.