Is Engineers India overvalued or undervalued?

As of 20 June 2025, the valuation grade for Engineers India has moved from expensive to very expensive, indicating a significant shift in its market perception. The company is currently considered overvalued. Key ratios include a PE Ratio of 21.44, an EV to EBITDA of 21.83, and a PEG Ratio of 0.71, which suggests that while the growth potential is priced attractively relative to earnings, the overall valuation remains high compared to its peers.
In comparison to its industry, Engineers India’s PE Ratio is lower than that of Rail Vikas at 63.57 and Tube Investments at 82.99, both of which are also classified as very expensive. However, it is worth noting that the company’s valuation appears stretched when considering its return metrics, with a YTD return of 21.21% compared to the Sensex's 5.46%, but a 1Y return of -14.15% against the Sensex's 6.36%. This discrepancy reinforces the notion that Engineers India is currently overvalued in the market.