Is Aavas Financiers overvalued or undervalued?

Sep 12 2025 08:03 AM IST
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As of September 11, 2025, Aavas Financiers is considered very expensive and overvalued compared to its peers, with a PE Ratio of 26.13 and an EV to EBITDA of 15.79, while its stock has underperformed the Sensex with a year-to-date return of -3.45%.
As of 11 September 2025, Aavas Financiers has moved from an expensive to a very expensive valuation grade. The company is currently overvalued based on its financial metrics. Key ratios include a PE Ratio of 26.13, an EV to EBITDA of 15.79, and a Price to Book Value of 3.40, all of which are significantly higher than those of its peers.

In comparison, HUDCO has a PE of 15.59 and an EV to EBITDA of 13.64, while LIC Housing Finance stands out with a very attractive PE of 5.64. These comparisons highlight Aavas Financiers' overvaluation in the context of the housing finance industry. Furthermore, the company's recent stock performance has lagged behind the Sensex, with a year-to-date return of -3.45% compared to the Sensex's 4.36%, reinforcing the notion of overvaluation.
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