Is Regency Fincorp overvalued or undervalued?

As of 20 August 2025, Regency Fincorp's valuation grade has moved from fair to expensive, indicating a shift in perception regarding its market value. The company is currently considered overvalued, with a PE ratio of 29.53, an EV to EBIT of 17.73, and an EV to EBITDA of 16.88. In comparison to its peers, Life Insurance, which is rated very attractive, has a significantly lower PE ratio of 11.68, while Bajaj Finance is categorized as very expensive with a PE ratio of 31.66.
Regency Fincorp's financial metrics suggest that it is trading at a premium compared to its industry peers, which raises concerns about its sustainability at these levels. The company's recent stock performance has outpaced the Sensex over the past week and month, with returns of 14.92% and 30.37%, respectively. However, the longer-term outlook shows a decline year-to-date, which further supports the conclusion that Regency Fincorp is overvalued in the current market environment.