Is Focus Lighting overvalued or undervalued?

As of 2 July 2025, the valuation grade for Focus Lighting has moved from expensive to very expensive, indicating a significant shift in its market perception. The company appears to be overvalued, with a PE ratio of 48.42, a Price to Book Value of 5.25, and an EV to EBITDA ratio of 28.54. These ratios suggest that the stock is trading at a premium compared to its earnings and book value.
When compared to peers, Focus Lighting's valuation stands out as particularly high, especially against A B B, which has a PE ratio of 66.13, and BHEL with a PE of 169.96. Other peers like Apar Industries, which is rated as fair, have a much lower PE ratio of 43.36, further highlighting Focus Lighting's overvaluation. Additionally, the company's recent stock performance has been underwhelming, with a year-to-date return of -13.29% compared to the Sensex's 7.65%, reinforcing the notion that the stock may not justify its current price level.