Is HP Telecom overvalued or undervalued?

As of 5 September 2025, HP Telecom's valuation grade has moved from very expensive to expensive, indicating a slight improvement in its valuation outlook. However, the company remains overvalued based on its current financial metrics. The PE ratio stands at 18.94, while the EV to EBITDA is at 12.10, both of which are significantly higher than industry peers such as PTC India, which boasts a much lower PE ratio of 8.39 and an EV to EBITDA of 4.47, indicating a more attractive valuation.
In comparison to its peers, HP Telecom's ROCE of 16.91% and ROE of 16.67% suggest decent profitability, yet the high valuation ratios imply that the stock is overvalued. The lack of a dividend yield and a PEG ratio of 0.00 further emphasize the challenges in justifying its current price. Despite a strong recent performance compared to the Sensex, with a 1-week return of 11.73% versus the Sensex's 1.29%, the overall valuation suggests that HP Telecom is overvalued in the current market environment.