Is Pecos Hotels overvalued or undervalued?

As of 25 August 2025, Pecos Hotels has moved from a fair to an expensive valuation grade. The company appears to be overvalued based on its current metrics. The PE ratio stands at 24.41, the Price to Book Value is 5.30, and the EV to EBITDA is 16.58, which are significantly higher than the industry averages.
In comparison to its peers, Pecos Hotels' PE ratio of 24.41 is notably lower than that of Indian Hotels Co at 65.61 and ITC Hotels at 72.49, both of which are categorized as very expensive. Despite having a strong ROCE of 69.68% and ROE of 21.72%, the high valuation ratios suggest that the stock is not a bargain at its current price of 266.50. Additionally, while Pecos Hotels has outperformed the Sensex in the short term, its longer-term returns indicate a decline, further supporting the view that it is currently overvalued.