Is L&T Finance Ltd overvalued or undervalued?

Oct 19 2025 08:06 AM IST
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As of October 17, 2025, L&T Finance Ltd is fairly valued with a PE ratio of 24.70 and strong performance, achieving a year-to-date return of 96.50%, significantly outperforming the Sensex, while compared to peers, Bajaj Finance is very expensive and Life Insurance is very attractive.
As of 17 October 2025, L&T Finance Ltd's valuation grade has moved from expensive to fair, indicating a shift in its perceived value. The company is currently fairly valued, with a PE ratio of 24.70, an EV to EBITDA ratio of 8.25, and a Price to Book Value of 0.25. In comparison to its peers, Bajaj Finance is categorized as very expensive with a PE ratio of 38.21, while Life Insurance is considered very attractive with a PE ratio of 11.49.

Despite L&T Finance Ltd's fair valuation, its return metrics suggest strong performance, with a year-to-date return of 96.50%, significantly outpacing the Sensex's 7.44% during the same period. This performance, along with its competitive ratios, supports the conclusion that L&T Finance Ltd is positioned well within its industry, particularly against peers like Bajaj Finance and Life Insurance.
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