Is Desco Infra. overvalued or undervalued?

As of 18 June 2025, Desco Infra. has moved from a fair to an expensive valuation grade. The company is currently considered overvalued based on its key financial ratios, including a PE ratio of 19.82, an EV to EBIT of 13.67, and an EV to EBITDA of 13.45. In comparison, its peers such as Larsen & Toubro, which has a PE of 33.74 and an EV to EBITDA of 17.14, and IRB Infra. Development with a PE of 37.85 and an EV to EBITDA of 12.86, highlight that Desco Infra. is trading at a premium relative to its industry.
Despite a recent stock performance that has outpaced the Sensex over the past week, with a return of 0.21% compared to the Sensex's -1.30%, the overall valuation metrics suggest that Desco Infra. does not provide sufficient upside potential at its current price of 233.90. Therefore, investors should be cautious as the stock appears to be overvalued in the current market environment.