Is REC Ltd overvalued or undervalued?

Nov 18 2025 08:21 AM IST
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As of November 17, 2025, REC Ltd is fairly valued with a PE ratio of 5.51 and a dividend yield of 5.45%, making it an attractive investment compared to competitors like Bajaj Finance, despite recent underperformance against the Sensex.
As of 17 November 2025, the valuation grade for REC Ltd has moved from expensive to fair, indicating a shift in its perceived value. The company is currently fairly valued, with a PE ratio of 5.51, a Price to Book Value of 1.14, and a PEG ratio of 0.34. These ratios suggest that REC Ltd is positioned attractively compared to its peers.

In comparison to notable competitors, Bajaj Finance is categorized as very expensive with a PE of 34.85, while Life Insurance is seen as very attractive with an EV to EBITDA of 9.36. REC Ltd's valuation metrics reflect a more favorable position, particularly with its dividend yield of 5.45% and ROE of 20.68%. Despite recent underperformance against the Sensex, with a year-to-date return of -27.77% compared to the Sensex's 8.72%, the company's fundamentals suggest it is currently a fair investment opportunity.
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