Is Bengal Tea & Fab overvalued or undervalued?

As of 25 May 2023, the valuation grade for Bengal Tea & Fab has moved from very expensive to risky. The company is currently assessed as overvalued given its negative PE ratio of -27.96 and EV to EBIT of -5.65, which indicate significant financial distress. Additionally, the ROE stands at -4.32%, further supporting the conclusion that the company is not generating adequate returns for shareholders.
In comparison to its peers, Bengal Tea & Fab's valuation metrics are starkly unfavorable. For instance, K P R Mill Ltd, categorized as very expensive, has a PE ratio of 47.51, while Trident, rated as fair, has a PE of 42.6. The significant divergence in these ratios highlights Bengal Tea & Fab's overvaluation relative to its industry peers. Despite a strong 5-year return of 607.86%, the recent performance has lagged behind the Sensex, particularly in the year-to-date period, where it has declined by 9.88% compared to the Sensex's 5.63% gain.