Is Candour Techtex overvalued or undervalued?

As of 12 June 2025, the valuation grade for Candour Techtex has moved from fair to expensive, indicating a shift towards overvaluation. The company is currently assessed as overvalued, with a PE ratio of 157.35, an EV to EBITDA ratio of 30.31, and a ROE of 2.33%. In comparison, peer companies such as Bajaj Steel Industries, which has a PE ratio of 23.14, and Integra Engineering, with a PE ratio of 39.06, highlight the significant premium at which Candour Techtex is trading.
The elevated valuation ratios suggest that investors are paying a high price for relatively low returns, as evidenced by the company's ROCE of only 2.20%. Despite a strong one-year stock return of 102.73% compared to the Sensex's 6.64%, the current valuation metrics raise concerns about sustainability and future growth potential. Overall, Candour Techtex appears to be overvalued in the current market context.