Is Maruti Sec. overvalued or undervalued?

As of 28 August 2025, the valuation grade for Maruti Sec. has moved from very expensive to risky, indicating a significant shift in its perceived value. The company is currently considered undervalued, with a PE ratio of 2.78, an EV to EBIT ratio of 5.49, and an EV to Sales ratio of 4.99. These ratios suggest that the stock may be trading at a lower valuation compared to its earnings and sales potential.
In comparison to its peers, Maruti Sec. stands out with a notably low PE ratio of -28.69, while Life Insurance, considered very attractive, has a PE of 11.27. Additionally, Bajaj Finance, categorized as very expensive, has a PE of 31.28. The substantial returns of Maruti Sec., particularly a 704.67% increase over the past year compared to a -2.08% decline in the Sensex, further reinforces the argument for its undervaluation.