Is HFCL overvalued or undervalued?

As of 17 October 2025, HFCL's valuation grade changed from expensive to fair, indicating a shift in its market perception. The company is currently fairly valued. Key ratios include a PE ratio of 321.50, an EV to EBITDA of 38.86, and a ROCE of 6.94%. Compared to peers, Indus Towers has a PE ratio of 9.49 and an EV to EBITDA of 5.35, while Affle 3i is classified as very expensive with a PE of 66.33.
Despite the recent valuation adjustment, HFCL's stock has underperformed relative to the Sensex, particularly over the past year, where it has declined by 42.88% compared to the Sensex's 3.64% gain. This suggests that while the company is currently fairly valued, its performance may warrant further scrutiny in the context of its peers and market conditions.