Is Baba Food overvalued or undervalued?

As of 15 September 2025, the valuation grade for Baba Food has moved from expensive to fair. The company is currently fairly valued, with a PE ratio of 14.02, a Price to Book Value of 0.96, and an EV to EBITDA ratio of 9.97. In comparison to peers, Baba Food's valuation metrics stand out significantly against companies like Hindustan Unilever, which has a PE ratio of 56.96, and Nestle India, with a PE ratio of 77.73, both categorized as very expensive.
Despite Baba Food's fair valuation, it has underperformed compared to the Sensex, with a year-to-date return of -38.08% versus the Sensex's positive return of 6.02%. This disparity highlights the potential for recovery in the stock, given its current valuation metrics relative to its peers in the FMCG sector.