Is Reliance Home overvalued or undervalued?

As of 10 September 2025, the valuation grade for Reliance Home has moved from attractive to risky, indicating a significant deterioration in its financial standing. The company is currently assessed as overvalued given its troubling financial ratios, including a PE ratio of -66.26, an EV to EBITDA of -95.72, and a ROCE of -113.46%. These figures starkly contrast with peers such as LIC Housing Finance, which boasts a PE of 5.61 and an EV to EBITDA of 11.17, and PNB Housing, with a PE of 10.35 and an EV to EBITDA of 10.87, highlighting the relative weakness of Reliance Home's financial metrics.
In comparison to its peers, Reliance Home's financial ratios suggest that it is not only overvalued but also poses a higher risk to investors. The company has shown a year-to-date return of 17.04%, outperforming the Sensex's 4.21%, yet this performance does not mitigate the underlying financial concerns reflected in its valuation metrics. Overall, Reliance Home appears to be in a precarious position within the housing finance sector.