Is Entero Healthcar overvalued or undervalued?

As of 24 June 2025, Entero Healthcare's valuation grade has moved from very attractive to attractive, indicating a shift in market perception. The company is currently assessed as overvalued based on its high PE ratio of 52.22, an EV to EBITDA of 29.26, and a PEG ratio of 0.37, which suggests that the stock price may not be justified by its earnings growth potential.
In comparison to its peers, Entero Healthcare's PE ratio significantly exceeds that of TCS at 25.26 and Infosys at 24.6, both of which are considered attractive and fair, respectively. The high valuation metrics, coupled with a return on equity (ROE) of only 5.50% and a return on capital employed (ROCE) of 7.86%, further support the conclusion that Entero Healthcare is overvalued. Recent stock performance has also lagged behind the Sensex, with a year-to-date return of -19.39% compared to the Sensex's 5.01%, reinforcing concerns about its current valuation.