Is HUDCO overvalued or undervalued?

As of 8 October 2025, HUDCO's valuation grade has moved from fair to very expensive, indicating a significant shift in its market perception. The company appears to be overvalued at its current price of 225.65, especially when compared to its peers. Key ratios include a PE ratio of 16.24, an EV to EBITDA of 13.80, and a PEG ratio of 0.65, which suggest that despite a reasonable growth expectation, the stock is priced higher than its intrinsic value.
In comparison to its peers, HUDCO's valuation stands out unfavorably. For instance, LIC Housing Finance, which is rated very attractive, has a PE ratio of just 5.63, while PNB Housing, rated attractive, has a PE of 11.17. This stark contrast highlights HUDCO's overvaluation in the current market context. Additionally, HUDCO's recent stock performance has underperformed the Sensex, with a year-to-date return of -3.88% compared to the Sensex's 4.65%, further reinforcing the notion that the stock may not be a prudent investment at this time.