Is Five-Star Bus.Fi overvalued or undervalued?

As of 19 August 2025, the valuation grade for Five-Star Bus.Fi has moved from very attractive to attractive. The company is currently considered overvalued based on its financial metrics. Key ratios include a PE ratio of 15.93, an EV to EBIT of 10.85, and a PEG ratio of 0.82, which suggests that while the company has a reasonable earnings growth potential, its current valuation does not justify the price given the recent performance.
In comparison to peers, Five-Star Bus.Fi's PE ratio is higher than Life Insurance, which has a PE of 11.61 and is rated very attractive, while it significantly lags behind Bajaj Finance, which is deemed very expensive at a PE of 32.19. Furthermore, the company's stock has underperformed against the Sensex, with a year-to-date return of -23.59% compared to the Sensex's gain of 4.49%, reinforcing the notion that the stock may be overvalued at its current price of 588.25.