Is HFCL overvalued or undervalued?

As of 4 November 2025, HFCL's valuation grade has moved from expensive to fair, indicating a more favorable assessment of its current market position. The company appears to be undervalued, with a PE ratio of 398.76, an EV to EBITDA of 56.66, and a Price to Book Value of 0.27. These ratios suggest that while the PE ratio is exceptionally high, the low Price to Book Value indicates potential undervaluation relative to its assets.
In comparison to its peers, HFCL's valuation stands out significantly. For instance, Indus Towers, categorized as expensive, has a PE ratio of 11.3 and an EV to EBITDA of 5.96, while Affle 3i is deemed very expensive with a PE of 61.46. The stark contrast in these ratios highlights HFCL's relative position in the market. Despite a challenging year with a YTD return of -31.87% compared to the Sensex's 6.81%, the long-term performance over five years shows a remarkable gain of 355.33%, reinforcing the notion that HFCL may present a buying opportunity at its current valuation.