Is Emerald Finance overvalued or undervalued?

As of 10 October 2025, Emerald Finance's valuation grade has moved from fair to expensive, indicating a shift towards overvaluation. The company is currently assessed as overvalued based on key metrics such as a PE ratio of 26.74, an EV to EBIT ratio of 16.32, and a Price to Book Value of 3.28. Comparatively, Bajaj Finance, which is classified as very expensive, has a significantly higher PE ratio of 36.56, while Life Insurance stands out as very attractive with a PE ratio of 11.65.
Emerald Finance's valuation appears less favorable when juxtaposed with its peers, particularly given its PEG ratio of 0.32, which, while low, does not compensate for the high PE ratio in the context of its current market position. The stock has shown a 4.40% return over the past week, outperforming the Sensex, yet it has underperformed year-to-date with a decline of 36.17% compared to the Sensex's gain of 5.58%. Overall, the analysis suggests that Emerald Finance is overvalued in the current market environment.