Is Servotech Renew overvalued or undervalued?

As of 19 August 2025, the valuation grade for Servotech Renew has moved from expensive to very expensive, indicating a significant shift in its perceived value. The company is currently overvalued, as evidenced by its high PE ratio of 87.14, a Price to Book Value of 11.90, and an EV to EBITDA of 49.33. These ratios suggest that the stock is trading at a premium compared to its earnings and book value.
In comparison to its peers, Servotech Renew's PE ratio is notably higher than that of Siemens Energy Industries at 115.96 and ABB at 59.82, both of which are also classified as very expensive. The PEG ratio of 0.54 indicates that despite the high valuation, the growth prospects may not justify the price. Additionally, while Servotech has underperformed the Sensex over the past year with a return of -5.35% compared to the Sensex's 1.66%, its long-term performance over three and five years shows substantial growth, which may have contributed to its current high valuation.