Is HUDCO overvalued or undervalued?

As of 9 October 2025, HUDCO's valuation grade has moved from very expensive to fair, indicating a more favorable assessment of its market position. The company is currently fairly valued based on its financial metrics. Key ratios include a PE ratio of 16.51, an EV to EBITDA of 13.87, and a PEG ratio of 0.67, suggesting that it is priced reasonably relative to its growth prospects.
In comparison to its peers, HUDCO's PE ratio is higher than LIC Housing Finance, which stands at 5.61, but lower than Aptus Value Housing at 19.46. This positions HUDCO in a competitive light within the finance industry, especially considering its dividend yield of 2.22% and ROE of 15.08%. While HUDCO has underperformed the Sensex in the short term, its long-term returns over three and five years significantly outpace the index, reinforcing its potential as a solid investment at its current valuation.