Is Hindustan Hardy overvalued or undervalued?

As of 1 July 2025, the valuation grade for Hindustan Hardy has moved from attractive to very attractive, indicating a strong positive shift in its valuation outlook. The company is currently considered undervalued based on its financial metrics. Key ratios include a PE ratio of 24.90, an EV to EBITDA of 16.91, and a PEG ratio of 0.65, which suggest that the stock is trading at a reasonable valuation relative to its growth prospects.
In comparison to peers, Hindustan Hardy's valuation stands out favorably against Samvardh. Mothe. with a PE of 28.15 and Motherson Wiring at 43.46. While other competitors like Bosch and Uno Minda are categorized as expensive with PE ratios of 47.44 and 66.05 respectively, Hindustan Hardy's robust ROCE of 26.11% and ROE of 25.57% further reinforce its undervaluation narrative. Notably, the company's stock has significantly outperformed the Sensex over the past year, returning 97.28% compared to the Sensex's 5.31%, highlighting strong market confidence in its growth potential.