Is Piramal Pharma overvalued or undervalued?

As of 19 September 2025, Piramal Pharma's valuation grade has moved from fair to expensive, indicating a shift towards overvaluation. The company appears overvalued based on its high PE ratio of 357.71, a Price to Book Value of 3.40, and an EV to EBIT of 61.77. In comparison to its peers, Sun Pharma has a PE of 34.58 and Divi's Lab shows a PE of 71.28, both of which further highlight Piramal's elevated valuation metrics.
The company's financial ratios, including a ROCE of 5.04% and a ROE of 1.12%, suggest inefficiencies in generating returns relative to its equity. Additionally, while Piramal Pharma has recently outperformed the Sensex over the past week and month, its year-to-date performance shows a decline of 21.63%, contrasting sharply with the Sensex's gain of 5.74%. Overall, the evidence points to Piramal Pharma being overvalued in the current market context.