Is Fervent Synerg. overvalued or undervalued?

As of 14 July 2025, the valuation grade for Fervent Synerg. has moved from expensive to very expensive, indicating a significant increase in perceived overvaluation. The company is currently assessed as overvalued, with a PE ratio of 49.61, an EV to EBIT ratio of 49.74, and an EV to EBITDA ratio of 49.08, all of which are considerably higher than industry peers. For comparison, Sun Pharma has a PE ratio of 35.28 and an EV to EBITDA of 24.94, while Cipla shows a more attractive PE ratio of 22.74 and an EV to EBITDA of 15.75.
Despite a strong performance in stock returns, with a 1-year return of 84.95% compared to the Sensex's 2.15%, the high valuation ratios and negative ROCE of -36.63% suggest that Fervent Synerg. is not justified at its current price level. The PEG ratio of 0.44 does indicate some growth potential, but it is overshadowed by the overall high valuation metrics, reinforcing the conclusion that the company is overvalued in the current market context.