Is JSW Steel overvalued or undervalued?

As of 9 October 2025, the valuation grade for JSW Steel has moved from fair to expensive. This indicates that the company is currently overvalued. Key ratios supporting this conclusion include a PE ratio of 56.18, an EV to EBITDA of 14.71, and a Price to Book Value of 3.62. In comparison to its peers, Tata Steel has a PE ratio of 45.37, while Jindal Steel stands at 25.25, both of which suggest that JSW Steel is trading at a significant premium relative to its competitors.
Additionally, the company's return metrics, such as a ROCE of 8.54% and a ROE of 4.76%, do not justify its high valuation. While JSW Steel has outperformed the Sensex in various timeframes, including a year-to-date return of 30.48% compared to the Sensex's 5.16%, this performance does not mitigate the overvaluation indicated by the financial ratios and peer comparisons.