Is Rama Phosphates overvalued or undervalued?

As of 22 July 2025, the valuation grade for Rama Phosphates has moved from fair to expensive, indicating a shift towards overvaluation. The company is currently assessed as overvalued based on its PE ratio of 30.58, EV to EBITDA of 15.46, and a PEG ratio of 0.19. In comparison to peers, Coromandel International is categorized as very expensive with a PE of 38.66, while Chambal Fertilizers is considered attractive with a PE of 13.39, highlighting the disparity in valuation within the sector.
Rama Phosphates' recent stock performance has significantly outpaced the Sensex, with a year-to-date return of 68.93% compared to the Sensex's 5.18%. This strong performance may not be sustainable given the current valuation metrics, suggesting that investors should exercise caution. Overall, the combination of high valuation ratios and peer comparisons supports the conclusion that Rama Phosphates is overvalued at its current price of 162.30.