Is Kothari Ferment. overvalued or undervalued?

As of 17 October 2025, Kothari Ferment. has seen its valuation grade change from very attractive to attractive, indicating a shift in market perception. The company is currently considered overvalued, primarily due to its significantly negative PE ratio of -54.22 and a ROE of -2.49%. The EV to EBITDA ratio stands at 11.38, which is relatively high compared to its peers, highlighting potential concerns about its profitability.
In comparison to its peers, Kothari Ferment. is positioned unfavorably against companies like Hindustan Unilever, which has a PE of 57.55, and Nestle India, with a PE of 83.02. This stark contrast in valuation metrics suggests that Kothari Ferment. may not be justifiably priced given its current financial performance. Additionally, while the stock has outperformed the Sensex in the short term with a 1-week return of 5.55% versus 1.76%, its longer-term performance remains concerning, particularly with a year-to-date decline of -32.04% compared to the Sensex's 7.44% gain.