Is Nucleus Soft. overvalued or undervalued?

As of 29 August 2025, Nucleus Software's valuation grade has moved from attractive to fair, indicating a shift in its perceived investment quality. The company is currently fairly valued, with a PE ratio of 16.28, an EV to EBIT ratio of 14.94, and a ROE of 20.02%. Compared to its peers, TCS and Infosys, which have PE ratios of 22.65 and 22.39 respectively, Nucleus Software appears to be trading at a discount, suggesting potential undervaluation relative to these industry leaders.
In terms of performance, Nucleus Software's recent stock return over the past year has been -26.39%, significantly underperforming the Sensex's -2.83% return, which may raise concerns among investors. However, its strong ROCE of 33.63% indicates efficient capital use, which could support future growth. Overall, while the company is fairly valued according to its current metrics, its relative performance and valuation compared to peers suggest it may be worth monitoring for potential opportunities.