Is Polytex India overvalued or undervalued?

As of 12 November 2024, Polytex India has moved from a grade of "does not qualify" to "risky." The company is currently considered undervalued based on its financial metrics. The PE ratio stands at 6.08, significantly lower than its peers, with Life Insurance at 12.54 and Bajaj Finance at 35.01. Additionally, the EV to EBIT and EV to EBITDA ratios are both at -6.25, indicating potential issues with profitability, while the ROE is a relatively strong 20.56%.
In comparison to its peers, Polytex India appears to be undervalued, especially when looking at the PEG ratio of 0.00, which suggests that the stock may be trading at a discount relative to its growth expectations. Despite a challenging year where the stock has declined by 48.18% compared to a 7.63% gain in the Sensex, the valuation metrics suggest that there may be an opportunity for investors looking for value in the Non-Banking Financial Company sector.