Is Indian Renewable overvalued or undervalued?

As of 9 July 2025, the valuation grade for Indian Renewable has moved from very expensive to expensive, indicating a slight improvement in its valuation outlook. The company is currently deemed overvalued based on its financial metrics. Key ratios include a PE ratio of 27.44, an EV to EBITDA of 15.95, and a PEG ratio of 0.92, which suggests that while growth expectations are present, the current price may not justify the earnings potential.
In comparison to its peers, Indian Renewable's PE ratio is significantly higher than Life Insurance, which has a PE of 12.38, and IRFC at 27.65, both of which are considered fairly valued. This disparity highlights that Indian Renewable is trading at a premium relative to its peers, reinforcing the conclusion of overvaluation. Additionally, the company's stock has underperformed against the Sensex, with a year-to-date return of -22.89% compared to the Sensex's 6.91%, further supporting the notion that the current valuation may not be sustainable.