Is HDFC Life Insur. overvalued or undervalued?

Jun 23 2025 08:02 AM IST
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As of June 20, 2025, HDFC Life Insurance is considered overvalued with a PE ratio of 92.73 and a current price of 779.35, significantly higher than its peers, despite outperforming the Sensex over the past year.
As of 20 June 2025, HDFC Life Insurance has moved from a fair valuation to an expensive rating. The company is currently considered overvalued, with a PE ratio of 92.73, a Price to Book Value of 10.39, and an EV to EBITDA ratio of 204.57. These figures indicate a significant premium compared to its peers, such as SBI Life Insurance, which has a PE ratio of 74.92 and is rated very attractive, and Life Insurance, which has a fair PE ratio of 12.26.

The high valuation metrics suggest that HDFC Life Insurance is trading at a substantial premium relative to its industry peers, indicating that the stock may not be a prudent investment at its current price of 779.35. While the company has outperformed the Sensex over the past year with a return of 32.1% compared to the Sensex's 6.36%, this does not mitigate the concerns regarding its high valuation.
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