Is Bothra Metals overvalued or undervalued?

As of 4 June 2025, the valuation grade for Bothra Metals has moved from expensive to very expensive, indicating a significant increase in perceived overvaluation. The company is currently considered overvalued, with a PE ratio of 24.89, an EV to EBITDA ratio of 30.08, and a ROE of only 2.09%. These ratios suggest that the stock price is not justified by its earnings or book value, especially when compared to peers such as Hindalco Industries, which has a PE ratio of 8.8 and an EV to EBITDA of 5.93, and National Aluminium with a PE of 6.57 and an EV to EBITDA of 4.05.
The stark contrast in valuation metrics highlights Bothra Metals' overvaluation in the non-ferrous metals industry. While the stock has shown a 10.1% return over the past year, it has underperformed the Sensex, which returned 7.62% in the same period. This further reinforces the notion that the current market price may not be sustainable given the company's financial performance relative to its peers.