Is Pecos Hotels overvalued or undervalued?

As of 7 August 2025, Pecos Hotels' valuation grade has moved from very attractive to fair, indicating a shift in its perceived value. The company is currently fairly valued, with a PE ratio of 20.56, an EV to EBITDA of 13.60, and a PEG ratio of 0.88. Compared to its peers, Pecos Hotels stands out as more reasonably priced; for instance, Indian Hotels Co has a PE ratio of 62.15 and an EV to EBITDA of 36.58, while ITC Hotels shows a PE of 69.92 and an EV to EBITDA of 39.85, both categorizing them as very expensive.
Despite the fair valuation, Pecos Hotels has demonstrated strong performance metrics, including a remarkable ROCE of 69.68% and an ROE of 21.72%. While the stock has underperformed the Sensex year-to-date and over the past year, it has shown significant growth over three years with a return of 367.99%, suggesting that the company has potential for recovery and growth in the long term.