Is Bajaj Healthcare overvalued or undervalued?

As of 7 November 2025, Bajaj Healthcare's valuation grade has moved from fair to expensive, indicating a shift in its perceived market value. The company is currently overvalued based on its financial metrics. Key ratios include a PE ratio of 27.28, an EV to EBITDA of 18.91, and a PEG ratio of 0.83, which suggests that while the company is growing, its valuation may not be justified by its earnings growth prospects.
In comparison to its peers, Bajaj Healthcare's PE ratio is notably higher than Cipla's 22.33, which is rated attractive, and Dr. Reddy's Labs at 17.43, also attractive. This indicates that Bajaj Healthcare is trading at a premium relative to these competitors despite not offering a significantly better growth outlook. Additionally, the stock has underperformed against the Sensex in the year-to-date period, with a return of -24.7% compared to the Sensex's 6.50%, further reinforcing the notion that the stock may be overvalued in the current market environment.