Is REC Ltd overvalued or undervalued?

As of 17 September 2025, the valuation grade for REC Ltd has moved from very attractive to attractive. The company is currently considered undervalued based on its financial ratios. Key metrics include a PE ratio of 5.99, a Price to Book Value of 1.29, and an EV to EBITDA of 10.56. In comparison to peers, REC Ltd's PE ratio is significantly lower than that of Bajaj Finance, which stands at 35.94, indicating that REC Ltd is trading at a much more favorable valuation. Additionally, Life Insurance, which is rated very attractive, has a PE ratio of 11.52, further highlighting REC Ltd's relative undervaluation. Despite a year-to-date decline of 23.22% in stock price compared to a 5.83% increase in the Sensex, the long-term performance remains strong, with a 3-year return of 269.16%.