Is Foundry Fuel overvalued or undervalued?

As of 12 November 2024, the valuation grade for Foundry Fuel has moved from does not qualify to risky. The company is currently considered undervalued based on its low PE ratio of 5.30, which is significantly lower than peers like Coal India Ltd. at 6.95 and NMDC Ltd. at 9.74. Additionally, the EV to EBIT and EV to EBITDA ratios are both at -6.14, indicating negative earnings performance, which is a notable outlier in comparison to its peers.
Despite the negative capital employed and book value, the low valuation metrics suggest that Foundry Fuel may be undervalued relative to its industry. The company's recent stock performance shows a decline of 51.86% over the past year, contrasting sharply with the Sensex's return of 7.60%, which further emphasizes the potential for recovery if the company can stabilize its operations.