Is Arabian Petrol. overvalued or undervalued?

As of 26 August 2025, the valuation grade for Arabian Petroleum has moved from attractive to fair, indicating a shift in its perceived value. The company is currently fairly valued based on its financial metrics, with a PE ratio of 8.47, an EV to EBITDA ratio of 6.89, and a ROE of 19.71%.
In comparison to its peers, Arabian Petroleum's valuation appears more reasonable, especially when contrasted with Solar Industries, which is deemed very expensive at a PE ratio of 101.49, and Godrej Industries, which is attractive at a PE of 42.36. While Arabian Petroleum's stock has underperformed relative to the Sensex over the past year, with a decline of 11.27% compared to a slight drop of 1.19% for the index, its current ratios suggest it is positioned fairly within its industry.