Is Smart Finsec overvalued or undervalued?

As of 10 October 2025, Smart Finsec's valuation grade has moved from fair to very expensive, indicating a significant shift in its market perception. The company is currently considered overvalued. Key ratios include a PE Ratio of 29.95, an EV to EBIT of 19.81, and an EV to EBITDA of 19.28, all of which suggest that the stock is trading at a premium compared to its earnings and cash flow generation capabilities.
In comparison to its peers, Smart Finsec's PE Ratio is notably higher than Life Insurance, which has a PE of 11.65 and is rated very attractive, and Bajaj Finserv, which is rated expensive with a PE of 33.63. Additionally, the company has underperformed against the Sensex in recent periods, with a year-to-date return of -23.16% compared to the Sensex's 5.58%. This further reinforces the view that Smart Finsec is overvalued in the current market environment.