Is Gland Pharma overvalued or undervalued?

As of 23 June 2025, Gland Pharma's valuation grade has moved from expensive to very expensive, indicating a significant shift in its perceived market value. The company is currently considered overvalued. Key ratios reveal a PE ratio of 41.02, an EV to EBITDA of 20.81, and a Price to Book Value of 3.13, which are substantially higher than many of its peers.
In comparison, Sun Pharma has a PE ratio of 34.87 and an EV to EBITDA of 24.63, while Cipla, which is rated attractive, has a PE ratio of 22.95 and an EV to EBITDA of 15.9. This suggests that Gland Pharma's valuation metrics are not only elevated relative to its direct competitors but also reflect a premium that may not be justified by its financial performance, as evidenced by a ROE of just 7.63%. Additionally, Gland Pharma's stock has underperformed against the Sensex over various time frames, further supporting the conclusion of overvaluation.