Is Desco Infra. overvalued or undervalued?

As of 18 September 2025, the valuation grade for Desco Infra. has moved from expensive to fair, indicating a shift in its perceived value. The company is currently fairly valued, with a PE ratio of 19.58, an EV to EBIT of 13.51, and an EV to EBITDA of 13.29. In comparison to peers, Larsen & Toubro is rated as attractive with a PE of 32.69 and an EV to EBITDA of 16.99, while CG Power & Ind is considered very expensive with a PE of 123.15.
Despite the fair valuation, Desco Infra. has underperformed relative to the Sensex, with a 1-month stock return of -12.45% compared to the Sensex's 2.14% gain. This performance may suggest potential concerns in market sentiment or operational challenges that could affect future growth. Overall, the company's current valuation appears justified based on its financial metrics and peer comparisons.