Is Muthoot Finance overvalued or undervalued?

Aug 22 2025 08:02 AM IST
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As of August 21, 2025, Muthoot Finance is fairly valued with a PE ratio of 17.35, significantly lower than its peers like Bajaj Finance and Bajaj Finserv, and has outperformed the Sensex with a return of 39.08% over the past year.
As of 21 August 2025, Muthoot Finance's valuation grade has moved from expensive to fair, indicating a more favorable assessment of its market position. The company is currently fairly valued, with a PE ratio of 17.35, a Price to Book Value of 3.64, and an EV to EBITDA ratio of 12.03. These ratios suggest that Muthoot Finance is competitively positioned relative to its peers.

In comparison to its industry, Muthoot Finance's PE ratio is notably lower than that of Bajaj Finance, which stands at 31.94, and Bajaj Finserv at 33.21, both categorized as very expensive. Conversely, Life Insurance is rated very attractive with a PE of 11.62, highlighting the competitive landscape. Additionally, Muthoot Finance has outperformed the Sensex significantly over the past year, with a return of 39.08% compared to the Sensex's 1.35%, reinforcing its strong market performance despite recent fluctuations.
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