Is Paul Merchants overvalued or undervalued?

As of 8 August 2025, the valuation grade for Paul Merchants has moved from very expensive to fair. This indicates a more favorable assessment of the company's valuation, suggesting it is currently fairly valued. The company exhibits a PE ratio of 10.49, an EV to EBIT of 3.87, and an EV to EBITDA of 3.54, which are relatively low compared to some peers in the industry.
In comparison to its peers, Life Insurance has a PE ratio of 11.83 and an EV to EBITDA of 9.24, while Bajaj Finance is significantly higher at a PE of 31.31 and an EV to EBITDA of 17.85, highlighting that Paul Merchants is positioned more attractively within the market. Although the company has underperformed on a year-to-date basis with a return of -20.11% compared to the Sensex's 2.20%, its long-term performance over three years shows a robust return of 87.22%, indicating potential for recovery and growth.