Is Deccan Healthcar overvalued or undervalued?

As of 25 August 2025, Deccan Healthcar's valuation grade has moved from fair to attractive, indicating a positive shift in its market perception. The company appears to be undervalued given its current price of 18.77, especially when compared to its peers. Key ratios include a PE ratio of 42.35, an EV to EBITDA of 13.51, and a Price to Book Value of 0.41, which suggest that the stock is trading at a discount relative to its intrinsic value.
In comparison with peers, Deccan Healthcar's PE ratio is higher than Sun Pharma's 34.66 but lower than Divi's Lab's significantly high 71.92, which is categorized as very expensive. Additionally, while Cipla is also rated attractive with a PE of 23.99, Deccan's lower Price to Book Value indicates a more favorable valuation. Notably, the company's stock has underperformed against the Sensex, with a year-to-date return of -35.83% compared to the Sensex's 4.48%, reinforcing the notion that the stock may be undervalued in the current market environment.