Is Sobha overvalued or undervalued?

As of 14 July 2025, the valuation grade for Sobha has moved from expensive to very expensive. This indicates that the company is currently overvalued. Key ratios supporting this assessment include a PE Ratio of 174.08, an EV to EBITDA of 53.89, and a PEG Ratio of 2.30, all of which are significantly higher than typical industry benchmarks.
When compared to peers, Sobha's valuation metrics stand out unfavorably; for instance, DLF has a PE Ratio of 43.8 and an EV to EBITDA of 96.73, while Lodha Developers shows a PE of 51.27 and an EV to EBITDA of 36.69. These comparisons further reinforce the conclusion that Sobha is overvalued. Additionally, the stock has underperformed relative to the Sensex over the past year, with a return of -21.07% compared to the Sensex's 2.15%, highlighting the disconnect between its high valuation and market performance.