Is Arihant Capital overvalued or undervalued?

As of 1 October 2025, the valuation grade for Arihant Capital has moved from attractive to fair. The company is currently fairly valued based on its financial ratios, which include a PE ratio of 23.69, an EV to EBITDA of 10.52, and a ROE of 14.62%. In comparison to its peers, Arihant Capital's PE ratio is significantly lower than that of Bajaj Finance, which stands at 35.27, indicating that Arihant may be more reasonably priced relative to this competitor. Conversely, Life Insurance, which is rated very attractive, has a PE ratio of 11.74, suggesting that Arihant is priced higher than some of its more attractive peers.
The recent performance of Arihant Capital has outpaced the Sensex, with a year-to-date return of 15.97% compared to the Sensex's 3.64%. This strong performance may suggest underlying strength in the company's fundamentals, despite the current fair valuation. Overall, while Arihant Capital is fairly valued, its competitive ratios and recent stock performance indicate potential for future growth.