Is Arrowhead Sepera overvalued or undervalued?

As of 14 October 2025, Arrowhead Sepera's valuation grade has moved from expensive to very expensive, indicating a significant increase in perceived overvaluation. The company is currently assessed as overvalued, with a PE ratio of 40.17, an EV to EBITDA ratio of 17.59, and a ROE of only 2.47%. These metrics suggest that the stock price is not justified by its earnings or book value, particularly when compared to peers like Rail Vikas, which has a PE ratio of 58.07, and AIA Engineering, with a PE of 27.47.
The valuation landscape shows that Arrowhead Sepera's ratios are considerably high relative to its peers, reinforcing the conclusion of overvaluation. Furthermore, the company's stock has underperformed significantly compared to the Sensex, with a year-to-date return of -39.04% versus the Sensex's 4.98%. This stark contrast highlights the potential risks for investors considering Arrowhead Sepera at its current price of 88.00.