Is REC Ltd overvalued or undervalued?

Nov 15 2025 08:08 AM IST
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As of November 14, 2025, REC Ltd is considered overvalued with a valuation grade of expensive, reflected by a PE ratio of 5.46 and underperformance against the Sensex, while its peers show varying valuations, with Bajaj Finance being very expensive and Life Insurance very attractive.
As of 14 November 2025, the valuation grade for REC Ltd has moved from fair to expensive, indicating a shift in perception regarding its market value. The company appears to be overvalued at this time. Key ratios include a PE ratio of 5.46, an EV to EBITDA of 10.52, and a PEG ratio of 0.34, which suggests that while the earnings growth potential is strong relative to its price, the overall valuation remains high compared to its peers.

In comparison to notable peers, Bajaj Finance is categorized as very expensive with a PE ratio of 34.62, while Life Insurance is considered very attractive with a PE of 11.25. This highlights that REC Ltd's valuation is not justified when compared to its industry counterparts. Additionally, REC Ltd has underperformed against the Sensex, with a year-to-date return of -28.44% compared to the Sensex's 8.22%, reinforcing the notion that the stock is currently overvalued.
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