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MUMBAI, Sept 24

UNION Bank of India closed its first day of trading at Rs 16.30, just above the issue price of Rs 16, on the Bombay Stock Exchange (BSE). Opening at Rs 17.50, the stock touched a low of Rs 16.15 before closing at Rs 16.30. Total number of shares traded was 70.87 lakh shares.

On the National Stock Exchange (NSE), the stock opened at Rs 16.05 and registered a high of Rs 17.40 and a low of Rs 16.20 before closing at Rs 16.35. Around 82 lakh shares were traded on the counter on the BSE. Over 35 per cent of traded quantity is up for delivery on the NSE.

The Rs 288-crore IPO was oversubscribed in excess of five times. Dealers contend the market is currently on a bearish mode with the economic outlook being dull. There is not much activity and the stock would have done better if it had entered the market in a bull phase.

The stock was expected to settle at around Rs 18 in a week, said a dealer.

A section of market participants felt that the issue rode the wave of success of its predecessor, Punjab National Bank. "Most of the oversubscription of Union Bank was due to the hype associated with PNB being a success story. It remains to be seen how the stock will perform from here on," said a dealer.

"The PNB issue was priced at Rs 31 and got listed at Rs 38. In a couple of month, the stock touched Rs 50. Within six months of the issue, PNB has generated 40-per cent return to its investors. Naturally, expectations are high on Union bank," he said.

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