Is Som Datt Finance overvalued or undervalued?

As of 17 October 2025, the valuation grade for Som Datt Finance has moved from risky to very expensive, indicating a significant shift in its market perception. The company is currently overvalued, as evidenced by its PE ratio of -35.44 and EV to EBITDA ratio of -30.56, both of which are negative and suggest unsustainable earnings. Additionally, the Price to Book Value stands at 4.87, further highlighting the premium investors are paying relative to the company's net assets.
When compared to peers, Som Datt Finance's valuation metrics starkly contrast with those of Bajaj Finance, which has a PE ratio of 38.21, and Life Insurance, which boasts a PE of 11.49. This disparity underscores the overvaluation of Som Datt Finance in relation to its industry. While the company has shown strong historical returns, including a 3-year return of 219.62%, its recent performance has lagged behind the Sensex, particularly with a year-to-date decline of 8.08% compared to the Sensex's gain of 7.44%.