Is Paul Merchants overvalued or undervalued?

As of 1 July 2025, the valuation grade for Paul Merchants has moved from expensive to fair, indicating a shift in its perceived value. The company is currently fairly valued, with a PE ratio of 10.70, an EV to EBIT of 3.95, and an EV to EBITDA of 3.61. Compared to peers, Life Insurance has a PE ratio of 12.71 and an EV to EBITDA of 10.03, while I R F C also holds a fair valuation with a PE of 28.43 and an EV to EBITDA of 21.88.
Despite the fair valuation, Paul Merchants has underperformed in recent returns, particularly year-to-date with a decline of 18.50% compared to the Sensex's gain of 7.11%. However, its low price-to-book value of 0.38 and a PEG ratio of 0.00 suggest potential for growth, reinforcing the notion that it is fairly valued within its industry context.