Is Aravali Sec overvalued or undervalued?

As of 4 September 2025, the valuation grade for Aravali Sec has moved from risky to very attractive, indicating a significant improvement in its perceived investment quality. The company is currently considered undervalued, especially when compared to its peers. Key ratios include a PE ratio of -6.36, an EV to EBIT of -9.51, and a ROCE of -38.74%, all of which suggest substantial financial distress but also highlight the potential for recovery.
In comparison to peers, Bajaj Finance has a PE ratio of 33.36, while Life Insurance shows a more favorable PE of 11.41. This stark contrast emphasizes Aravali Sec's undervaluation relative to the market, despite its negative financial metrics. Notably, while the stock has underperformed against the Sensex over the past year with a decline of 19.23%, it has shown a remarkable 159.26% return over the past five years, reinforcing the potential for future growth.