Is Arabian Petrol. overvalued or undervalued?

As of 5 September 2025, Arabian Petroleum's valuation grade has moved from fair to attractive, indicating a positive shift in its market perception. The company is currently considered undervalued based on its financial metrics. Key ratios include a PE ratio of 8.67, an EV to EBITDA of 7.01, and a PEG ratio of 0.31, all of which suggest a strong valuation relative to its earnings and growth potential.
In comparison to its peers, Arabian Petroleum stands out with a significantly lower PE ratio than Solar Industries, which has a PE of 99.93, and Godrej Industries, which has a PE of 40.09. This highlights Arabian Petroleum's attractive valuation in a sector where many competitors are deemed very expensive. Additionally, while the company's stock has underperformed the Sensex year-to-date, its strong financial ratios suggest that it may present a compelling investment opportunity moving forward.