Is Porwal Auto Comp overvalued or undervalued?

As of 10 September 2025, the valuation grade for Porwal Auto Comp has moved from fair to expensive, indicating a shift towards overvaluation. The company is currently assessed as overvalued based on its high PE ratio of 59.98, an EV to EBITDA of 11.78, and a ROCE of just 4.23%. In comparison, Bharat Forge, a peer in the auto components industry, has a more reasonable PE ratio of 55.93 and an EV to EBITDA of 23.39, while CIE Automotive stands out with a very attractive valuation, showing a PE of 19.39 and an EV to EBITDA of 11.45.
Given these metrics, Porwal Auto Comp appears to be overvalued relative to its peers and the market conditions. Despite its recent stock performance, which has outpaced the Sensex over various periods, the underlying financial ratios suggest that the current price may not be justified by its earnings potential.