Is Birla Cable overvalued or undervalued?

As of 18 August 2025, Birla Cable's valuation grade has moved from very attractive to attractive, indicating a shift in market perception. The company is currently considered overvalued based on its high PE ratio of 76.92, which significantly exceeds that of its peers, such as Polycab India at 47.98 and Havells India at 69.04. Additionally, Birla Cable's EV to EBITDA ratio stands at 17.72, which is more favorable than the industry average but still reflects a premium valuation compared to its competitors.
In terms of financial performance, Birla Cable's ROCE is at 5.21% and ROE is at 2.80%, both of which are relatively low, suggesting that the company may not be generating sufficient returns on its capital compared to its peers. The company's stock has underperformed recently, with a year-to-date return of -26.97%, contrasting sharply with the Sensex's gain of 4.01% during the same period. Overall, the combination of high valuation ratios and underwhelming returns indicates that Birla Cable is currently overvalued in the market.