Is Grasim Inds overvalued or undervalued?

As of 5 August 2024, the valuation grade for Grasim Industries has moved from fair to attractive, indicating a positive shift in its perceived value. The company is currently considered undervalued. Key ratios include a PE ratio of 43.90, an EV to EBITDA of 11.89, and a Price to Book Value of 1.79, which suggest that while the company has a high earnings multiple, it is still positioned favorably compared to its peers.
In comparison to its industry peers, Grasim's PE ratio is lower than UltraTech Cement's 52.27 and Shree Cement's 94.75, both of which are classified as very expensive. Additionally, Grasim's EV to EBITDA of 11.89 is more attractive than Ambuja Cements' 21.70, which is categorized as expensive. Notably, Grasim has outperformed the Sensex over various periods, including a 3-year return of 99.91% compared to the Sensex's 49.19%, reinforcing the notion of its undervaluation.