Is Source Natural overvalued or undervalued?

As of 31 October 2025, the valuation grade for Source Natural has moved from fair to attractive, indicating a more favorable assessment of its market position. The company is currently considered undervalued, especially in comparison to its peers. Key ratios include a PE Ratio of 29.87, an EV to EBITDA of 16.92, and a PEG Ratio of 0.47, which suggests strong growth potential relative to its price.
In the peer comparison, Source Natural's PE Ratio is significantly lower than that of Sun Pharma, which stands at 35.35, and Divi's Lab, which is at 77.85. Additionally, Source Natural's EV to EBITDA ratio is more attractive than that of its peers, such as Cipla at 5.55 and Torrent Pharma at 31.86. Despite recent underperformance against the Sensex, with a year-to-date return of -24.97% compared to the Sensex's 7.42%, the company's valuation metrics indicate it is positioned well for future growth.