Is DCM Financial overvalued or undervalued?

As of 19 September 2025, the valuation grade for DCM Financial has moved from attractive to risky, indicating a significant deterioration in its financial standing. The company appears to be overvalued based on its current metrics, with a PE ratio of -9.33, an EV to EBITDA of -47.12, and a ROCE of -16.60%. These figures suggest that the company is struggling to generate positive earnings and is facing considerable financial challenges.
In comparison to its peers, DCM Financial's valuation stands out unfavorably. For instance, Bajaj Finance has a PE ratio of 35.51, while Life Insurance boasts a PE of 11.64, both indicating a much stronger market position. The stark contrast in these ratios highlights DCM Financial's precarious situation within the Non-Banking Financial Company (NBFC) sector. Additionally, the company's recent stock performance has been poor, with a year-to-date return of -25.77%, significantly underperforming the Sensex, which has returned 5.74% in the same period.