Is Amarnath Sec. overvalued or undervalued?

As of 15 May 2025, the valuation grade for Amarnath Sec. has moved from attractive to very attractive, indicating a significant improvement in its perceived value. The company is currently considered undervalued, with a PE ratio of 3.74, an EV to EBIT ratio of 4.43, and a PEG ratio of 0.71, all of which are substantially lower than industry peers. For instance, Life Insurance, which is rated fair, has a PE ratio of 12.54, while Bajaj Finance is deemed very expensive with a PE ratio of 35.01.
In comparison to its peers, Amarnath Sec. stands out with its low valuation metrics, suggesting that it offers a compelling investment opportunity relative to companies like Life Insurance and Bajaj Finance. Despite the recent underperformance of Amarnath Sec. against the Sensex, with a year-to-date return of -40.65% compared to the Sensex's 5.64%, the current valuation metrics indicate that the stock is trading at a significant discount, reinforcing the view that it is undervalued in the market.