Is SPML Infra overvalued or undervalued?

As of 13 November 2025, SPML Infra's valuation grade has moved from fair to attractive, indicating a more favorable assessment of the company's stock. The company appears to be undervalued, particularly when considering its PE ratio of 31.92, which is lower than that of its peer Larsen & Toubro at 34.31, despite SPML Infra having a significantly lower PEG ratio of 0.04 compared to Larsen & Toubro's 1.79. Additionally, SPML Infra's EV to EBITDA ratio stands at 43.33, which, while high, is still more attractive than the exorbitant ratios of peers like CG Power & Ind and Siemens.
In the context of its industry, SPML Infra's return on equity (ROE) is 6.22% and return on capital employed (ROCE) is 4.49%, which are relatively modest but suggest potential for improvement. The company's stock has underperformed compared to the Sensex over the past year, with a return of 2.18% against the Sensex's 8.74%, yet its long-term performance over three and five years shows remarkable growth of 575.97% and 2492.78%, respectively. This long-term perspective reinforces the notion that SPML Infra is currently undervalued in the market.