Is Explicit Finance overvalued or undervalued?

As of 14 October 2025, the valuation grade for Explicit Finance moved from very expensive to expensive. The company is currently considered overvalued. Key ratios include a PE ratio of 49.12, an EV to EBIT of 7.45, and a ROE of 2.40%. In comparison to its peers, Bajaj Finance has a PE ratio of 36.37, while Life Insurance stands out with a much lower PE of 11.7, indicating that Explicit Finance is priced significantly higher relative to its earnings potential.
Despite a strong performance over the past year with a stock return of 34.81% compared to a mere 0.07% for the Sensex, the high valuation ratios suggest that the stock may not be justified at its current price of 10.07. The PEG ratio of 0.07 further emphasizes the disparity between growth expectations and current pricing, reinforcing the conclusion that Explicit Finance is overvalued in the current market context.