Is Pecos Hotels overvalued or undervalued?

As of 9 June 2025, Pecos Hotels has moved from a grade of risky to expensive. The company is currently overvalued, with a PE ratio of 24.58, a Price to Book Value of 6.34, and an EV to EBITDA of 17.25. In comparison to its peers, Indian Hotels Co and ITC Hotels are also categorized as very expensive, with PE ratios of 66.99 and 65.02, respectively, indicating that Pecos Hotels, while overvalued, is still more reasonably priced relative to these competitors.
Despite its high ROCE of 70.65% and ROE of 25.78%, the valuation metrics suggest that the stock is trading at a premium. Recent performance shows that Pecos Hotels has outperformed the Sensex over the past year with a return of 106.46% compared to the Sensex's 7.50%, but this does not mitigate the overvaluation concern based on current ratios.