Is Laurus Labs overvalued or undervalued?

As of 26 September 2025, Laurus Labs has moved from a valuation grade of very expensive to expensive. The company is currently considered overvalued based on its high valuation ratios, including a PE ratio of 88.34, an EV to EBITDA of 37.57, and a Price to Book Value of 10.05. These figures indicate that the stock is trading at a premium compared to its earnings and book value.
In comparison with its peers, Laurus Labs' PE ratio significantly exceeds that of Sun Pharma, which stands at 33.18, and Divi's Lab at 65.51, both of which are also categorized as expensive. Notably, Cipla, classified as attractive, has a much lower PE ratio of 22.45, suggesting that Laurus Labs may not justify its current price level. While Laurus Labs has outperformed the Sensex over the past year with a return of 79.77% compared to the Sensex's -6.30%, the high valuation metrics indicate that the stock may be overextended at this time.