Is Neelam Linens overvalued or undervalued?

As of 10 October 2025, Neelam Linens' valuation grade has moved from expensive to fair, indicating a shift in its market perception. The company is currently fairly valued based on its financial ratios, with a PE ratio of 14.82, an EV to EBITDA of 9.62, and a Price to Book Value of 1.01. This suggests that the stock is reasonably priced relative to its earnings and book value.
In comparison to its peers, Neelam Linens stands out with a PE ratio that is significantly lower than K P R Mill Ltd, which is very expensive at 41.5, and Trident, which is also fairly valued at 33.16. Notably, Vardhman Textile, which is rated attractive, has a PE ratio of 13.63, indicating that Neelam Linens is competitively positioned within the industry. Despite recent underperformance, with a year-to-date return of -65.56% compared to the Sensex's 6.94%, the current valuation suggests that Neelam Linens may offer a more favorable investment opportunity moving forward.