Is Piramal Pharma overvalued or undervalued?

As of 14 July 2025, Piramal Pharma's valuation grade has moved from fair to expensive, indicating a shift in its perceived market value. The company is currently considered overvalued. Key financial ratios highlight this assessment, with a PE ratio of 303.18, an EV to EBIT of 50.86, and a PEG ratio of 3.45, all significantly higher than industry norms.
In comparison to its peers, Piramal Pharma's valuation stands out unfavorably. For instance, Sun Pharma has a PE ratio of 35.28 and an EV to EBITDA of 24.94, while Cipla is valued more attractively with a PE of 22.74 and an EV to EBITDA of 15.75. These comparisons suggest that Piramal Pharma is trading at a premium relative to its competitors, reinforcing the conclusion of overvaluation. Despite a recent one-year stock return of 37.51%, which outperformed the Sensex's 2.15%, the underlying financial metrics indicate that the stock may not be justified at its current price level.