Is Shriram Finance overvalued or undervalued?

As of 17 July 2025, the valuation grade for Shriram Finance has moved from attractive to fair, indicating a shift in its perceived value. The company is currently fairly valued based on its financial metrics, with a PE ratio of 15.10, an EV to EBITDA of 11.26, and a ROE of 14.67%.
In comparison to its peers, Shriram Finance's valuation is more favorable than Bajaj Finance, which is considered very expensive with a PE ratio of 34.51, but less attractive than Life Insurance, which has a PE ratio of 12.12. The stock has performed well, with a year-to-date return of 14.90%, significantly outpacing the Sensex's return of 5.27% during the same period. Overall, while Shriram Finance is fairly valued, its competitive ratios suggest it remains a solid choice within the NBFC sector.