Is Danish Power overvalued or undervalued?

As of 26 September 2025, the valuation grade for Danish Power has moved from very expensive to expensive, indicating a slight improvement in its perceived value. However, the company is still considered overvalued based on its current metrics. The PE ratio stands at 28.82, while the EV to EBITDA ratio is 19.15, both of which are significantly higher than many peers in the industry. For instance, Siemens Energy has a PE ratio of 126.13 and an EV to EBITDA of 504.18, while ABB shows a PE of 61.02 and an EV to EBITDA of 47.64, reinforcing the notion that Danish Power's valuation remains high relative to its peers.
In terms of financial performance, Danish Power exhibits a strong ROCE of 38.81% and an ROE of 18.19%, which are commendable figures. However, the high valuation ratios suggest that the stock may be overvalued, especially given its recent performance, where it has underperformed the Sensex with a year-to-date return of -22.08% compared to the Sensex's 4.27%. Overall, despite some strong operational metrics, Danish Power appears to be overvalued in the current market context.