Is Star Paper Mills overvalued or undervalued?

As of 2 July 2025, the valuation grade for Star Paper Mills has moved from fair to attractive, indicating a positive shift in its perceived value. The company appears to be undervalued, particularly when considering its low PE ratio of 6.67, a price-to-book value of 0.42, and an EV to EBITDA ratio of 2.11. These metrics suggest that the stock is trading at a significant discount compared to its earnings and book value.
In comparison to its peers, Star Paper Mills' valuation stands out; for instance, JK Paper has a PE ratio of 15.32 and an EV to EBITDA of 8.30, while West Coast Paper shows a PE of 10.92 and an EV to EBITDA of 5.45. This peer analysis reinforces the notion that Star Paper Mills is undervalued relative to its industry counterparts. Additionally, despite recent underperformance against the Sensex, with a year-to-date return of -18.04% compared to the Sensex's 6.75%, the company's fundamentals suggest a potential for recovery and growth moving forward.