Is Axis Bank overvalued or undervalued?

As of 16 September 2025, the valuation grade for Axis Bank has moved from fair to expensive. The company appears to be overvalued based on its current financial metrics. Key ratios include a PE ratio of 13.31, a price-to-book value of 1.88, and a PEG ratio of 3.55, which suggest that the stock is trading at a premium compared to its earnings growth potential.
In comparison to its peers, Axis Bank's PE ratio is significantly lower than HDFC Bank's 21.42 and ICICI Bank's 20.75, both of which are also classified as expensive. This indicates that while Axis Bank is perceived as expensive, it is still cheaper relative to some of its direct competitors. Additionally, the recent stock performance shows that Axis Bank has outperformed the Sensex over the past week and month, but its one-year return of -8.96% contrasts with the Sensex's slight decline of -0.73%, reinforcing the notion that the stock may be overvalued at its current price of 1121.20.