Is Bombay Metrics overvalued or undervalued?

As of 23 September 2025, the valuation grade for Bombay Metrics has moved from expensive to very expensive, indicating a significant shift in its market perception. The company is currently considered overvalued. Key ratios include a PE ratio of 13.84, an EV to EBITDA of 10.00, and a ROE of 22.67%.
When compared to peers, Bombay Metrics' PE ratio is notably lower than that of Rail Vikas, which stands at 62.36, and Tube Investments, which has a PE of 98.51. Despite this, the overall valuation suggests that Bombay Metrics is trading at a premium relative to its earnings potential. The company's recent stock performance has been underwhelming, with a year-to-date return of -16.29%, contrasting sharply with the Sensex's positive return of 6.45% during the same period, further reinforcing the notion of overvaluation.