Is Alpex Solar overvalued or undervalued?

As of 7 November 2025, Alpex Solar's valuation grade has moved from expensive to very expensive, indicating a significant shift in its market perception. The company is currently overvalued based on its financial ratios, which include a PE Ratio of 37.81, an EV to EBITDA of 23.32, and a ROE of only 1.75%. These metrics suggest that investors are paying a premium for the stock relative to its earnings and book value.
When compared to peers, Alpex Solar's valuation appears particularly high. For instance, Siemens Energy has a PE Ratio of 117.2, while ABB stands at 60.16, both of which are also categorized as very expensive. However, these companies have higher earnings multiples, indicating that Alpex Solar's valuation may not be justified given its lower return metrics, such as a ROCE of 2.57%. Additionally, the company has outperformed the Sensex in recent periods, with a year-to-date return of 50.92% compared to the Sensex's 7.81%, but this does not mitigate the overvaluation concern.