Is Sobha overvalued or undervalued?

As of 11 July 2025, Sobha's valuation grade has moved from very expensive to expensive, indicating a slight shift in perception but still reflecting a high valuation. The company is currently considered overvalued. Key ratios include a PE ratio of 168.80, an EV to EBITDA of 52.19, and a PEG ratio of 2.23, all of which suggest that the stock is trading at a premium compared to its earnings growth prospects.
In comparison to its peers, Sobha's PE ratio significantly exceeds that of DLF, which stands at 43.19, and Macrotech Developers at 50.65, both categorized as very expensive. This stark difference highlights Sobha's elevated valuation within the realty sector. Furthermore, Sobha's recent stock performance has underperformed the Sensex, with a year-to-date return of -4.71% compared to the Sensex's 5.58%, reinforcing the notion that the stock may be overvalued in the current market environment.