Is Morarka Finance overvalued or undervalued?

As of 4 November 2025, Morarka Finance's valuation grade has moved from fair to expensive, indicating a shift in its perceived value. The company appears to be overvalued at its current price of 98.84, particularly when considering its PE ratio of 23.80 and EV to EBITDA ratio of 23.86, which are significantly higher than some peers. For instance, Bajaj Finance, while categorized as very expensive, has a PE ratio of 37.67, and Life Insurance, deemed very attractive, has a much lower PE ratio of 11.76.
In comparison to its peers, Morarka Finance's PEG ratio stands at 0.00, which suggests that it may not be generating growth in line with its price, further supporting the conclusion of overvaluation. Additionally, the company's return on equity (ROE) and return on capital employed (ROCE) are both at a low 0.17%, raising concerns about its profitability relative to its valuation. Despite a recent uptick in stock price, Morarka Finance's year-to-date return of -35.82% starkly contrasts with the Sensex's positive return of 6.81%, reinforcing the notion that the stock is not performing well relative to the broader market.