Is Mega Corp. overvalued or undervalued?

As of 1 July 2025, Mega Corp. has moved from an expensive to a very expensive valuation grade. The company is currently overvalued, as indicated by its high PE ratio of 53.20, an EV to EBIT of 22.62, and a Price to Book Value of 2.17. In comparison, its peers such as Life Insurance, which is fairly valued with a PE of 12.71, and Bajaj Finance, classified as very expensive with a PE of 34.98, highlight the significant premium at which Mega Corp. is trading.
The company's financial metrics, including a ROCE of 5.42% and a ROE of 1.02%, suggest inefficiencies in generating returns relative to its high market valuation. Additionally, while Mega Corp. has experienced a remarkable 1Y return of 56.01%, this is juxtaposed against a negative YTD return of -34.00%, further emphasizing the disconnect between its stock price and fundamental performance. Overall, the valuation suggests that Mega Corp. is not justified at its current price levels.