Is IDBI Bank overvalued or undervalued?

As of 22 August 2025, IDBI Bank's valuation grade has moved from attractive to very attractive, indicating a significant improvement in its perceived value. The bank appears to be undervalued, supported by a PE ratio of 13.09, a Price to Book Value of 1.64, and a PEG ratio of 0.48. These metrics suggest that the bank is trading at a reasonable valuation compared to its growth prospects.
In comparison to its peers, IDBI Bank stands out with a lower PEG ratio than State Bank of India, which has a PEG of 1.63, and Bank of Baroda, which has a PEG of 0.77. Notably, IDBI Bank's Return on Equity (ROE) is 12.51%, which is competitive within the sector. The recent performance of IDBI Bank has also been strong, with a year-to-date return of 24.18%, significantly outperforming the Sensex's return of 4.05% over the same period, reinforcing the notion that the bank is undervalued in the current market.