Is Chothani Foods overvalued or undervalued?

As of 31 October 2025, the valuation grade for Chothani Foods has moved from risky to very expensive. The company is currently overvalued, with a PE ratio of 310.80, an EV to EBIT of 44.58, and a ROE of only 0.90%. In comparison to its peers, Hindustan Unilever has a PE of 54.79 and Nestle India has a PE of 81.91, both significantly lower than Chothani Foods, indicating a stark valuation disparity.
Chothani Foods' high valuation metrics, particularly its PE ratio, suggest that investors are paying a premium that is not justified by its earnings growth potential, as reflected in its PEG ratio of 0.00. The company's recent stock performance has outpaced the Sensex over the long term, with a 5-year return of 955.28%, but the current valuation raises concerns about sustainability. Overall, the company appears to be in a precarious position, warranting caution for potential investors.