Is Primo Chemicals overvalued or undervalued?

As of 3 September 2025, the valuation grade for Primo Chemicals has moved from attractive to very attractive, indicating a significant improvement in its perceived value. The company is currently considered undervalued. Key ratios include a PE ratio of 32.91, an EV to EBITDA of 10.63, and a PEG ratio of 0.21, which suggests strong growth potential relative to its price.
In comparison to its peers, Primo Chemicals stands out with a much lower PE ratio than Solar Industries at 102.52 and Godrej Industries at 40.01, both of which are classified as very expensive. Additionally, Primo's EV to EBITDA ratio is also more favorable compared to its peers. Despite recent underperformance against the Sensex, with a year-to-date decline of 31.55% versus a 3.11% gain in the index, the company's valuation metrics suggest it is positioned for recovery and growth in the commodity chemicals sector.