Is Iris Clothings overvalued or undervalued?

As of 26 September 2025, the valuation grade for Iris Clothings has moved from very expensive to expensive, indicating a slight improvement in its perceived value. The company is currently considered overvalued. Key ratios include a PE ratio of 45.60, an EV to EBITDA of 24.03, and a Price to Book Value of 7.38, which are significantly higher than industry peers such as Vardhman Textile with a PE of 14.17 and Trident with a PE of 33.51. In comparison to its peers, Iris Clothings' valuation metrics suggest it is trading at a premium, particularly when considering its PEG ratio of 0.00, which indicates no growth expectations priced into the stock. The recent performance shows that while Iris Clothings has outperformed the Sensex over the past month with a return of 0.60% compared to the Sensex's -0.23%, its longer-term performance has been poor, with a 1-year return of -13.37% versus the Sensex's -5.96%. This further reinforces the view that the stock is overvalued in its current state.