Is Dhanlaxmi Bank overvalued or undervalued?

As of 14 November 2025, Dhanlaxmi Bank's valuation grade has moved from fair to attractive, indicating a positive shift in its perceived value. The bank is currently assessed as undervalued, particularly in comparison to its peers. Key ratios include a PE ratio of 12.66, a price to book value of 0.75, and a PEG ratio of 0.10, which suggest that the bank is trading at a discount relative to its earnings growth potential.
In comparison to its peers, Dhanlaxmi Bank stands out with a significantly lower PE ratio than HDFC Bank at 21.37 and ICICI Bank at 19.79, both of which are considered expensive. The bank's net NPA to book value ratio of 10.08% also reflects a manageable risk profile. While the stock has underperformed the Sensex year-to-date with a return of -13.66% compared to the Sensex's 8.22%, its strong performance over the last five years, with a return of 120.77%, reinforces the attractiveness of its current valuation.