Is Bajaj Electrical overvalued or undervalued?

As of 13 May 2025, Bajaj Electrical has moved from a valuation grade of very expensive to expensive. The company is currently considered overvalued based on its high valuation ratios. The PE ratio stands at 64.98, the Price to Book Value is 4.36, and the EV to EBITDA ratio is 24.65, all of which are significantly above industry averages.
When compared to peers in the Electronics & Appliances sector, Bajaj Electrical's valuation appears steep; for instance, its PE ratio is notably higher than the industry average, indicating a premium that may not be justified by its earnings growth. Additionally, the company's recent stock performance has been underwhelming, with a year-to-date decline of 14.72% compared to a 5.60% gain in the Sensex, reinforcing the notion that the stock may be overvalued at its current price of 660.90.