Is Kalyani Forge overvalued or undervalued?

As of 4 June 2025, Kalyani Forge's valuation grade has moved from attractive to fair, indicating a shift in its perceived value. The company is currently fairly valued. Key ratios include a PE ratio of 30.87, an EV to EBITDA of 12.99, and a PEG ratio of 0.37, which suggests that while the company has a high earnings multiple, its growth potential is not being fully reflected in its price.
In comparison to its peers, Kalyani Forge's PE ratio is significantly lower than Bharat Forge's 59.98 and Sona BLW Precision's 51.71, which are considered very expensive. However, it is higher than CIE Automotive's attractive PE of 21.15, indicating that Kalyani Forge may be positioned at a premium relative to some of its more attractively valued peers. Notably, Kalyani Forge has outperformed the Sensex over the past year, with a return of 68.63% compared to the Sensex's 7.65%, reinforcing its strong market performance despite the valuation adjustment.