Is Primo Chemicals overvalued or undervalued?

As of 16 September 2025, the valuation grade for Primo Chemicals has moved from very attractive to attractive. The company is currently considered overvalued based on its financial ratios. The PE ratio stands at 33.06, while the EV to EBITDA ratio is 10.67, and the PEG ratio is notably low at 0.21. These figures indicate a premium valuation compared to its peers.
In comparison to its industry peers, Godrej Industries has a higher PE ratio of 40.93 but a lower PEG ratio of 0.10, suggesting it may offer better growth prospects relative to its price. Solar Industries, on the other hand, is classified as very expensive with a PE ratio of 104.59, further highlighting Primo's relatively better valuation position despite being overvalued. Additionally, the company's stock has underperformed significantly over the past year, with a return of -40.40%, compared to a slight decline of -0.73% in the Sensex, reinforcing concerns about its current valuation.