Is Paragon Finance overvalued or undervalued?

As of 29 October 2025, Paragon Finance's valuation grade has moved from very expensive to fair. The company is currently fairly valued based on its financial ratios. Key ratios include a PE Ratio of 27.12, an EV to EBIT of -13.53, and an EV to Sales of 12.07.
When compared to peers, Paragon Finance's PE Ratio is significantly lower than Bajaj Finance, which stands at 37.96, indicating that Paragon may be more attractively priced relative to its earnings potential. In contrast, Life Insurance, which is rated very attractive, has a PE Ratio of 11.8, suggesting that Paragon Finance is positioned in the middle of the valuation spectrum within its industry. Recent stock performance shows that while Paragon has underperformed the Sensex year-to-date with a return of -21.18% compared to the Sensex's 8.78%, it has shown strong growth over the longer term, with a 5-year return of 292.10%.