Is Dhanlaxmi Cotex overvalued or undervalued?

As of 20 October 2025, the valuation grade for Dhanlaxmi Cotex has moved from very expensive to expensive. The company is currently considered overvalued. Key ratios include a PE ratio of 20.67, a price to book value of 1.09, and a PEG ratio of 0.54. In comparison, Bajaj Finance has a PE ratio of 38.6, indicating a significantly higher valuation, while Life Insurance shows a more attractive PE of 11.57, suggesting that Dhanlaxmi Cotex is priced higher relative to its earnings growth potential.
The company's recent stock performance has been notable, with a year-to-date return of 30.31%, significantly outperforming the Sensex's 7.97% over the same period. However, the EV to EBIT and EV to EBITDA ratios are both negative at -72.23, indicating potential concerns about profitability. Overall, these metrics suggest that Dhanlaxmi Cotex is priced too high relative to its earnings and growth prospects, reinforcing the conclusion of overvaluation.