Is ERIS Lifescience overvalued or undervalued?

As of 19 August 2025, the valuation grade for ERIS Lifescience has moved from expensive to very expensive, indicating a significant increase in perceived overvaluation. The company is currently assessed as overvalued. Key ratios include a PE ratio of 61.00, an EV to EBITDA of 24.78, and a PEG ratio of 37.25, all of which suggest that the stock is trading at a premium compared to its earnings and growth potential.
In comparison to its peers, ERIS Lifescience's PE ratio is notably higher than Sun Pharma's 34.22 and significantly above Cipla's attractive valuation at 23.2. Additionally, while ERIS has a ROCE of 13.77% and ROE of 12.35%, these returns do not justify the elevated valuation metrics. Despite recent strong stock performance, with a 1Y return of 44.97% compared to a 1.52% return of the Sensex, the current valuation levels indicate that ERIS Lifescience is not a compelling investment at this time.