Is Kay Power &Paper overvalued or undervalued?

As of 14 November 2025, Kay Power & Paper's valuation grade has moved from attractive to fair, indicating a shift in its perceived market value. The company is currently fairly valued, with a PE ratio of 31.18, an EV to EBITDA of 17.79, and a Price to Book Value of 0.66. In comparison to peers, JK Paper, which is rated attractive, has a significantly lower PE ratio of 21.67 and an EV to EBITDA of 9.25, while West Coast Paper, classified as expensive, has a PE ratio of 15.82 and an EV to EBITDA of 5.74.
Despite its fair valuation, Kay Power & Paper has underperformed relative to the Sensex, with a year-to-date return of -63.76% compared to the Sensex's 8.22%. This underperformance, along with its low ROCE of 1.21% and ROE of 2.13%, suggests that while the stock is fairly valued, it may face challenges in generating returns that justify its current valuation.