Is Quality Power El overvalued or undervalued?

As of 18 March 2025, the valuation grade for Quality Power El has moved from does not qualify to very expensive, indicating a significant shift in its perceived value. The company is currently overvalued, with a PE ratio of 53.83, an EV to EBITDA ratio of 52.11, and a Price to Book Value of 8.58. These ratios suggest that the stock is trading at a premium compared to its earnings and book value.
In comparison to its peers, Quality Power El's valuation appears steep. For instance, Larsen & Toubro Ltd. has a PE ratio of 34.21 and an EV to EBITDA of 17.35, while Siemens Ltd. is at a PE of 56.88 and an EV to EBITDA of 52.96. The significant disparity in these ratios reinforces the notion that Quality Power El is overvalued in its sector. Additionally, the stock has outperformed the Sensex over the past month, returning 40.39% compared to the Sensex's 3.80%, but this does not mitigate the concerns regarding its high valuation metrics.