Is Avasara Finance overvalued or undervalued?

As of 17 October 2025, Avasara Finance's valuation grade has moved from risky to very expensive, indicating a significant deterioration in its valuation outlook. The company is currently considered overvalued, with a PE ratio of -67.14, an EV to EBIT of -13.42, and a Price to Book Value of 6.68. These ratios reflect substantial financial distress, particularly the negative earnings multiples, which suggest that the company is not generating profits.
In comparison to its peers, Avasara Finance stands out unfavorably; for instance, Bajaj Finance has a PE ratio of 38.21 and an EV to EBITDA of 20.25, while Life Insurance boasts a PE of 11.49 and an EV to EBITDA of 8.94. Such comparisons highlight Avasara's extreme valuation relative to more stable companies in the sector. Additionally, despite a recent stock return of 4.68% over the past week, it has underperformed against the Sensex's 1.76% return, further reinforcing the notion of its overvaluation.