Is Kallam Textiles overvalued or undervalued?

As of 16 August 2023, Kallam Textiles has moved from an attractive to a risky valuation grade, indicating a significant deterioration in its financial health. The company is currently considered overvalued based on its negative PE ratio of -0.60, an EV to EBITDA of -48.58, and a ROE of -34.18%. These ratios highlight the company's struggles in generating profits and managing its capital effectively.
In comparison to its peers, Kallam Textiles stands out unfavorably against K P R Mill Ltd, which has a PE ratio of 47.51, and Trident, with a PE ratio of 42.6. This stark contrast underscores the challenges faced by Kallam Textiles in the garments and apparel industry. Additionally, the company's stock has underperformed significantly against the Sensex, with a year-to-date return of -22.30% compared to the Sensex's 5.66%, further reinforcing the perception of overvaluation.