Is IFCI overvalued or undervalued?

As of 10 November 2025, the valuation grade for IFCI has moved from very expensive to expensive, indicating a slight improvement in its perceived value. Despite this change, IFCI is still considered overvalued. The company's PE ratio stands at 45.64, significantly higher than peers like Bajaj Finance at 38.76 and Shriram Finance at 17.77, which further supports the overvaluation assessment. Additionally, its EV to EBITDA ratio is 10.78, again higher than many competitors, while the PEG ratio of 0.36 suggests that growth expectations may not justify the current price.
In comparison to its peers, IFCI's valuation metrics are not favorable; for instance, Bajaj Finserv has a PE of 35.58 and Life Insurance boasts a much lower EV to EBITDA of 11.14, reflecting a more attractive valuation. Furthermore, IFCI's recent stock performance has lagged behind the Sensex, with a year-to-date return of -12.28% compared to the Sensex's 6.91%. This trend underscores the challenges IFCI faces in justifying its current valuation amidst a competitive landscape.