Is Five-Star Bus.Fi overvalued or undervalued?

As of 29 August 2025, the valuation grade for Five-Star Bus.Fi has moved from attractive to very attractive. The company is currently considered undervalued, with a PE ratio of 14.87, an EV to EBITDA ratio of 10.16, and a PEG ratio of 0.76. In comparison to its peers, Bajaj Finance is classified as very expensive with a PE ratio of 31.3, while Life Insurance is very attractive with a PE ratio of 11.08, indicating that Five-Star Bus.Fi is positioned favorably within its industry.
Despite the positive valuation metrics, Five-Star Bus.Fi has experienced a significant decline in stock performance, with a year-to-date return of -28.69%, contrasting sharply with a 2.14% return from the Sensex. This divergence suggests that the market may not yet fully recognize the company's intrinsic value, reinforcing the conclusion that it is undervalued relative to its financial performance and peer comparisons.