Is MMTC overvalued or undervalued?

As of 29 October 2021, the valuation grade for MMTC has moved from very expensive to risky. Based on the analysis, MMTC appears to be overvalued. The company's PE ratio stands at an exceptionally high 119.39, while its EV to EBITDA ratio is -70.04, indicating significant concerns regarding profitability. Additionally, the ROE is relatively low at 5.44%, which further highlights the company's inefficiency in generating returns for shareholders.
In comparison to its peers, MMTC's valuation metrics are starkly higher; for instance, Elitecon International has a PE ratio of 131.08 and an EV to EBITDA of 132.27, while PTC India, which is classified as very attractive, has a PE ratio of just 9.02 and an EV to EBITDA of 4.14. This stark contrast suggests that MMTC is not only overvalued relative to its peers but also carries a higher risk profile. Notably, while MMTC has shown strong returns over the past five years at 338.06%, it has underperformed the Sensex in the last year, which may further reinforce concerns about its current valuation.