Is Narayana Hrudaya overvalued or undervalued?

As of 18 March 2025, Narayana Hrudaya's valuation grade has moved from fair to expensive, indicating a shift towards overvaluation. The company is currently assessed as overvalued, with a PE ratio of 44.91, a Price to Book Value of 9.86, and an EV to EBITDA ratio of 28.62. These figures suggest that the stock is trading at a premium compared to its earnings and book value.
In comparison to its peers, Narayana Hrudaya's valuation metrics stand out, particularly when looking at competitors such as Fortis Healthcare, which has a PE ratio of 35.00, and Apollo Hospitals, with a PE ratio of 40.00. This highlights that Narayana Hrudaya is trading at a significantly higher valuation relative to its industry peers. Additionally, the company's recent stock performance has outpaced the Sensex, with a year-to-date return of 40.87% compared to the Sensex's 5.61%, further emphasizing the market's optimistic outlook despite the high valuation.