Is Arrow Greentech overvalued or undervalued?

As of 2 June 2025, Arrow Greentech's valuation grade has moved from expensive to very expensive, indicating a significant increase in perceived valuation. The company is currently considered overvalued. Key ratios include a PE ratio of 15.76, an EV to EBITDA of 10.23, and a PEG ratio of 0.14, which suggests that while the earnings growth potential is high, the current price does not reflect this adequately.
When compared to peers, Arrow Greentech's PE ratio is notably lower than that of Supreme Industries at 57.34 and Astral at 78.35, both of which are also categorized as very expensive. Despite its strong ROCE of 82.78% and ROE of 33.52%, the company's recent stock performance has lagged behind the Sensex, particularly with a year-to-date return of -18.20% compared to the Sensex's 5.61%. This further reinforces the conclusion that Arrow Greentech is overvalued in the current market context.