Is My Mudra Fin. overvalued or undervalued?

As of 26 June 2025, the valuation grade for My Mudra Finance has moved from expensive to very expensive, indicating a significant shift in its market perception. The company is currently considered overvalued. Key ratios include a PE ratio of 9.73, an EV to EBITDA of 6.75, and a ROE of 53.64%, which, while strong, do not justify the current valuation in comparison to peers.
When compared to its peers, My Mudra Finance's PE ratio is notably lower than that of Bajaj Finance, which stands at 35.54, and Life Insurance, which is at 12.52, both of which are considered fairly valued. Additionally, the company's recent stock performance has lagged behind the Sensex, with a year-to-date return of -3.81% compared to the Sensex's 8.05%, reinforcing the notion that the stock may be overvalued in the current market context.