Is Aavas Financiers overvalued or undervalued?

Jul 02 2025 08:07 AM IST
share
Share Via
As of July 1, 2025, Aavas Financiers is considered overvalued with a PE ratio of 33.01 and an expensive valuation grade, despite a strong year-to-date return of 22.04%, as its metrics do not justify its premium compared to peers like HUDCO and LIC Housing Finance.
As of 1 July 2025, Aavas Financiers has moved from a valuation grade of very expensive to expensive. The company is currently considered overvalued. Key ratios include a PE ratio of 33.01, an EV to EBIT of 18.47, and a Price to Book Value of 4.29. In comparison to peers, HUDCO has a PE ratio of 17.78 and LIC Housing Finance has a significantly lower PE of 6.18, indicating that Aavas is trading at a premium relative to its competitors.

Despite recent stock performance showing a 22.04% year-to-date return compared to the Sensex's 7.11%, the elevated valuation metrics suggest that Aavas Financiers may not justify its current price levels. The company’s ROE stands at 13.00%, which, while respectable, does not sufficiently support its high valuation in light of peer comparisons.
{{stockdata.stock.stock_name.value}} Live

{{stockdata.stock.price.value}} {{stockdata.stock.price_difference.value}} ({{stockdata.stock.price_percentage.value}}%)

{{stockdata.stock.date.value}} | BSE+NSE Vol: {{stockdata.index_name}} Vol: {{stockdata.stock.bse_nse_vol.value}} ({{stockdata.stock.bse_nse_vol_per.value}}%)


Our weekly and monthly stock recommendations are here
Loading...
{{!sm.blur ? sm.comp_name : ''}}
Industry
{{sm.old_ind_name }}
Market Cap
{{sm.mcapsizerank }}
Date of Entry
{{sm.date }}
Entry Price
Target Price
{{sm.target_price }} ({{sm.performance_target }}%)
Holding Duration
{{sm.target_duration }}
Last 1 Year Return
{{sm.performance_1y}}%
{{sm.comp_name}} price as on {{sm.todays_date}}
{{sm.price_as_on}} ({{sm.performance}}%)
Industry
{{sm.old_ind_name}}
Market Cap
{{sm.mcapsizerank}}
Date of Entry
{{sm.date}}
Entry Price
{{sm.opening_price}}
Last 1 Year Return
{{sm.performance_1y}}%
Related News