Is Devyani Intl. overvalued or undervalued?

As of 20 June 2025, the valuation grade for Devyani International has moved from fair to attractive, indicating a more favorable assessment of its market position. The company is currently considered overvalued, primarily due to its exceptionally high PE ratio of 1457.38, which starkly contrasts with peers like Page Industries at 68.45 and Jubilant Food at 202.64. Additionally, the EV to EBITDA ratio stands at 28.55, which, while lower than some peers, still suggests a premium valuation relative to the industry.
In comparison to its peers, Devyani's PEG ratio is notably at 0.00, suggesting no expected growth in earnings, which is concerning given the high valuation metrics. The company's ROCE and ROE are also low at 5.88% and 1.26%, respectively, further supporting the overvaluation thesis. Recent stock performance has lagged behind the Sensex, with a year-to-date return of -8.23% compared to the Sensex's 5.46%, reinforcing the notion that the stock may not justify its current price.