Is IIFL Finance overvalued or undervalued?

Oct 09 2025 08:04 AM IST
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As of October 8, 2025, IIFL Finance is considered overvalued with a PE ratio of 22.81 and an EV to EBITDA of 11.74, despite strong stock performance, indicating limited upside potential at its current price of 488.70 compared to its peers.
As of 8 October 2025, the valuation grade for IIFL Finance has moved from fair to expensive, indicating a shift in perception regarding its market value. The company is currently considered overvalued. Key ratios include a PE ratio of 22.81, an EV to EBITDA of 11.74, and a ROCE of 9.10%.

In comparison to its peers, IIFL Finance's valuation stands out as expensive, especially when juxtaposed with Bajaj Finance, which has a PE ratio of 36.53, and Life Insurance, which is valued attractively with an EV to EBITDA of 9.04. While IIFL Finance has shown strong stock performance, particularly with a YTD return of 18.06% compared to the Sensex's 4.65%, the current valuation metrics suggest that the stock may not offer sufficient upside potential at its current price of 488.70.
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