Is K&R Rail Engine. overvalued or undervalued?

As of 13 November 2025, K&R Rail Engine has moved from a very attractive to a risky valuation grade. The company is currently overvalued, reflected by a PE ratio of -70.84 and an EV to EBITDA ratio of 139.78, which are significantly out of line with industry norms. The price to book value stands at 1.43, indicating a premium over its book value, while the ROCE and ROE are relatively low at 9.30% and 5.77%, respectively.
In comparison to its peers, K&R Rail Engine's valuation metrics starkly contrast with Larsen & Toubro, which has a PE ratio of 34.31 and an EV to EBITDA of 18.10, highlighting the latter's more favorable position in the market. Other peers like CG Power & Ind and Siemens are also trading at much higher valuations, with PE ratios of 109.83 and 57.16, respectively. The company's recent stock performance has been poor, with a year-to-date return of -89.2%, compared to an 8.11% return for the Sensex, further reinforcing the notion of overvaluation.