Is Valiant Laborato overvalued or undervalued?

As of 12 November 2025, the valuation grade for Valiant Laborato has moved from risky to attractive, indicating a more favorable outlook for the company. Despite this positive grade change, the company appears to be overvalued based on its current financial ratios. The PE ratio stands at 85.85, significantly higher than peers like Cipla at 22.56 and Dr. Reddy's Labs at 17.77. Additionally, the EV to EBITDA ratio is 69.60, which again is much higher compared to the industry averages.
In terms of performance, Valiant Laborato's ROCE is -2.42% and ROE is -0.94%, suggesting inefficiencies in generating returns. The PEG ratio of 0.61 indicates potential growth, but the high valuation ratios overshadow this. Given the peer comparison and the current financial metrics, Valiant Laborato is deemed overvalued despite its attractive grade. Furthermore, the company's stock has underperformed relative to the Sensex, with a year-to-date return of -27.64% compared to the Sensex's 8.10%, reinforcing the valuation concerns.