Is Sakthi Finance overvalued or undervalued?

As of 27 June 2025, Sakthi Finance has moved from a fair valuation to an expensive one. The company is currently considered overvalued based on its financial metrics. Key ratios include a Price to Earnings (PE) ratio of 19.85, an EV to EBITDA ratio of 9.32, and a PEG ratio of 3.44, which indicate a premium valuation compared to its peers.
In comparison, Life Insurance, which is rated fair, has a PE ratio of 12.53 and an EV to EBITDA of 9.88, while Bajaj Finance is categorized as very expensive with a PE ratio of 35.35. The notable differences in these ratios suggest that Sakthi Finance is trading at a higher valuation relative to its peers, reinforcing the assessment of it being overvalued. Additionally, while Sakthi Finance has shown strong returns over the long term, its year-to-date performance is down 14.20%, contrasting with the Sensex's gain of 7.58%, further highlighting the valuation concerns.