Is Malu Paper overvalued or undervalued?

As of 11 February 2025, the valuation grade for Malu Paper has moved from expensive to risky, indicating a significant deterioration in its financial standing. The company is currently assessed as overvalued. Key ratios highlight this concern: the PE ratio stands at -5.54, the EV to EBITDA ratio is an alarming -203.22, and the ROE is an extraordinarily low -1213.00%.
In comparison to its peers, Malu Paper's valuation metrics are starkly unfavorable. For instance, JK Paper, categorized as very attractive, has a PE ratio of 15.48 and an EV to EBITDA of 8.36, while West Coast Paper, rated as fair, has a PE of 10.55 and an EV to EBITDA of 5.21. These comparisons underscore Malu Paper's precarious position in the market. Despite a recent positive return of 19.22% over the past year compared to the Sensex's 7.61%, the underlying financial ratios suggest that the stock remains overvalued relative to its peers.