Is LIC Housing Fin. overvalued or undervalued?

As of 22 August 2025, the valuation grade for LIC Housing Finance has moved from attractive to very attractive, indicating a significant improvement in its valuation outlook. The company is currently considered undervalued. Key financial ratios include a PE ratio of 5.63, a Price to Book Value of 0.85, and a Dividend Yield of 3.38%.
In comparison to its peers, LIC Housing Finance stands out with a much lower PE ratio than HUDCO, which is at 15.24, and PNB Housing at 10.25, both of which are considered attractive or very expensive. Additionally, the company's PEG ratio of 0.36 further supports its undervaluation relative to the sector. While the stock has underperformed against the Sensex over the past year, it has shown strong returns over a three-year period, suggesting potential for recovery and growth.