Is Rane (Madras) overvalued or undervalued?

As of 17 July 2025, Rane (Madras) has moved from an attractive to a fair valuation grade. The company is currently fairly valued, with a PE ratio of 173.14, an EV to EBITDA of 14.74, and a ROCE of 7.61%. In comparison to its peers, Bosch is considered expensive with a PE of 56.5, while Samvardhana Motherson is attractive with a PE of 28.47, highlighting Rane's relatively high valuation in the context of its industry.
Despite its fair valuation, Rane (Madras) has shown mixed performance against the Sensex, with a year-to-date return of 3.86% compared to the Sensex's 5.27%. The company's high PE ratio and low ROE of 2.14% suggest that while it may not be overvalued, it is priced at a premium relative to its earnings potential, indicating caution for potential investors.