Is Aksh Optifibre overvalued or undervalued?

As of 28 May 2024, the valuation grade for Aksh Optifibre has moved from attractive to risky, indicating a significant deterioration in its financial standing. The company is currently assessed as overvalued, primarily due to its troubling financial ratios, including a negative PE ratio of -4.96, an EV to EBITDA of -44.63, and a ROE of -252.89%. These figures highlight severe operational challenges and a lack of profitability.
In comparison to its peers, Aksh Optifibre's valuation appears starkly unfavorable. For instance, while Havells India has a PE ratio of 64.84 and an EV to EBITDA of 43.36, R R Kabel maintains a fair valuation with a PE of 51.13 and an EV to EBITDA of 32.83. The stark contrast in these ratios underscores Aksh Optifibre's precarious position in the market. Additionally, the company's recent stock performance has lagged behind the Sensex, with a year-to-date return of -21.47% compared to the Sensex's 5.62%, further reinforcing the perception of overvaluation.