Is Mazagon Dock overvalued or undervalued?

As of 10 August 2023, the valuation grade for Mazagon Dock Shipbuilders Ltd. has moved from very attractive to very expensive, indicating a significant shift in its market perception. The company is currently considered overvalued based on its high valuation ratios. The PE ratio stands at 56.89, the Price to Book Value is 17.29, and the EV to EBITDA ratio is 58.83, all of which are considerably elevated compared to industry norms.
In comparison to its peers, Mazagon Dock's valuation appears excessive, especially when looking at similar companies. For instance, while Mazagon Dock has a PE ratio of 56.89, other peers may have significantly lower ratios, suggesting that investors are paying a premium for its stock. Additionally, despite a strong return of 114.11% over the past year, which outpaces the Sensex's 7.55%, the current high valuation metrics indicate that the stock may not sustain such performance moving forward.