Is Ajax Engineering overvalued or undervalued?

As of 4 August 2025, Ajax Engineering's valuation grade has moved from expensive to very expensive, indicating a significant shift in its market perception. The company is currently overvalued, with a PE ratio of 28.05, an EV to EBITDA of 20.96, and a Price to Book Value of 7.95. These ratios suggest that the stock is trading at a premium compared to its earnings and book value.
In comparison to its peers, Ajax Engineering's PE ratio is notably lower than that of Thermax at 62.76 and BEML Ltd at 56.77, both of which are also classified as very expensive. However, it is important to note that Ajax's PEG ratio is 0.00, indicating a lack of growth expectations priced into the stock. Recent performance shows that Ajax Engineering has underperformed the Sensex, with a 1-week return of -3.89% compared to the Sensex's modest gain of 0.16%. This further reinforces the view that the stock is overvalued in the current market environment.