Is Kabra Commercial overvalued or undervalued?

As of 17 October 2023, the valuation grade for Kabra Commercial has moved from attractive to risky, indicating a significant shift in its perceived value. The company appears to be overvalued, with a PE ratio of 7.58, an EV to EBIT of 11.34, and a Price to Book Value of 0.47. These ratios suggest that the company's earnings and asset valuations do not justify its current price level.
In comparison to its peers, Kabra Commercial's PE ratio is notably lower than that of MMTC Ltd., which has a PE of 119.39, and significantly lower than Elitecon International, which stands at 131.08. This stark contrast highlights the company's relative underperformance in terms of valuation metrics. Additionally, while Kabra Commercial has shown a stock return of 10.13% over three years, it lags behind the Sensex's return of 49.10% during the same period, further reinforcing the notion that the stock may be overvalued given its lackluster performance compared to broader market trends.