Is Dynamatic Tech. overvalued or undervalued?

As of 7 November 2025, the valuation grade for Dynamatic Tech. has moved from expensive to very expensive. The company is currently overvalued, with a PE ratio of 136.38, a Price to Book Value of 8.06, and an EV to EBITDA ratio of 40.44. Compared to its peers, such as Hindustan Aeronautics with a PE of 37.25 and Bharat Electronics with a PE of 53.18, Dynamatic Tech. significantly exceeds these valuations, indicating a premium that may not be justified by its financial performance.
The company's return metrics also reflect its overvaluation, with a ROCE of 7.16% and ROE of 6.00%, which are relatively low given its high valuation ratios. While the stock has outperformed the Sensex in various time frames, including a 1-month return of 23.69% compared to the Sensex's 1.57%, this does not mitigate the concerns regarding its current valuation levels. Overall, the substantial premium over its peers and the high valuation ratios suggest that Dynamatic Tech. is overvalued.