Is Indian Terrain overvalued or undervalued?

As of 6 August 2024, the valuation grade for Indian Terrain has moved from very attractive to risky, indicating a significant shift in its financial outlook. The company is currently considered overvalued, with a PE ratio of -4.24, an EV to EBITDA ratio of -37.01, and a ROE of -23.33%. These figures suggest that the company is struggling to generate profits and is facing substantial financial challenges.
In comparison to its peers, Indian Terrain's valuation metrics are concerning. For instance, MMTC has a PE ratio of 119.39, while PTC India, deemed very attractive, has a PE of 9.02. This stark contrast highlights Indian Terrain's underperformance relative to its industry. Additionally, the company's recent stock performance has been poor, with a year-to-date return of -19.16%, significantly lagging behind the Sensex's 5.59% return. Overall, the combination of negative ratios and poor stock performance reinforces the conclusion that Indian Terrain is overvalued in the current market.