Is Five-Star Bus.Fi overvalued or undervalued?

As of 22 August 2025, the valuation grade for Five-Star Bus.Fi has moved from attractive to very attractive. The company is currently deemed undervalued, supported by a PE ratio of 15.90, an EV to EBIT of 10.84, and a PEG ratio of 0.82. In comparison to its peers, Five-Star Bus.Fi's valuation metrics are favorable; for instance, Life Insurance has a PE of 11.55 and EV to EBITDA of 8.99, while Bajaj Finance is considered very expensive with a PE of 31.91.
Despite the positive valuation indicators, Five-Star Bus.Fi has underperformed compared to the Sensex, with a year-to-date return of -23.76% versus the Sensex's 4.05%. This discrepancy highlights a potential market mispricing, suggesting that the stock may be an attractive buying opportunity given its strong financial ratios and recent grade upgrade.