Is IIFL Finance overvalued or undervalued?

Oct 12 2025 08:08 AM IST
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As of October 10, 2025, IIFL Finance is considered very expensive and overvalued with a PE Ratio of 22.91 and an EV to EBITDA of 11.76, especially compared to peers like Bajaj Finance and Life Insurance, despite its strong year-to-date stock performance of 18.59% versus the Sensex's 5.58%.
As of 10 October 2025, IIFL Finance's valuation grade has moved from fair to very expensive, indicating a significant shift in its market standing. The company is currently overvalued based on its financial metrics. Key ratios include a PE Ratio of 22.91, an EV to EBITDA of 11.76, and a ROE of 7.78%.

When compared to its peers, IIFL Finance's valuation stands out as particularly high; for instance, Bajaj Finance has a PE Ratio of 36.56, while Life Insurance boasts a much lower EV to EBITDA of 9.08. This suggests that IIFL Finance is trading at a premium relative to its industry counterparts. Additionally, the company's recent stock performance has outpaced the Sensex, with a year-to-date return of 18.59% compared to the Sensex's 5.58%, further reinforcing the notion of overvaluation.
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