Is Neelkanth overvalued or undervalued?

As of 27 May 2025, the valuation grade for Neelkanth has moved from risky to very expensive, indicating a significant shift in its perceived value. The company is currently overvalued based on its financial ratios, with a PE ratio of 21.91, an EV to EBIT of 22.09, and an EV to Sales ratio of 4.47. These figures suggest that the stock is trading at a premium compared to its earnings and sales, which raises concerns about its sustainability.
In comparison to peers, Neelkanth's valuation stands out as particularly high; for instance, MMTC has a PE ratio of 119.39, while PTC India, which is rated very attractive, has a PE of just 9.02. Additionally, Elitecon International and Lloyds Enterprises both fall into the very expensive category with PE ratios of 131.08 and 156.59, respectively. Notably, Neelkanth's recent stock performance has outpaced the Sensex, with a 1-year return of 39.64% compared to the Sensex's 7.60%, but this does not mitigate the concerns regarding its current overvaluation.