Is Natl. Gen. Inds. overvalued or undervalued?
As of April 25, 2023, Natl. Gen. Inds. is considered risky and overvalued with a PE ratio of 32.61 and negative ROCE of -2.54%, underperforming the Sensex with a year-to-date return of -7.67%.
As of 25 April 2023, the valuation grade for Natl. Gen. Inds. moved from does not qualify to risky, indicating a shift in perception regarding its investment potential. The company appears to be overvalued, with a PE ratio of 32.61, an EV to EBITDA of 24.78, and a negative ROCE of -2.54%. These metrics suggest that the stock is trading at a premium compared to its earnings and capital efficiency.In comparison to its peers, Natl. Gen. Inds. has a significantly higher PE ratio than JSW Steel, which stands at 64.98, and Tata Steel, which is at 51.92. Moreover, while Natl. Gen. Inds. has an EV to Sales ratio of 2.40, Jindal Steel, considered attractive, has a much lower EV to EBITDA of 11.66. The company's recent stock performance has lagged behind the Sensex, with a year-to-date return of -7.67% compared to the Sensex's 5.66%, reinforcing the notion that it may be overvalued in the current market environment.
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