Is Steelman Telecom overvalued or undervalued?

As of 2 June 2025, Steelman Telecom's valuation grade has moved from does not qualify to risky, indicating a significant shift in its perceived risk profile. The company is currently assessed as overvalued, primarily due to its troubling financial ratios. The PE ratio stands at -106.57, while the EV to EBITDA ratio is at 35.59, both of which suggest severe profitability issues. Additionally, the ROCE is reported at -19.65%, further highlighting the company's challenges in generating returns on capital.
In comparison to its peers, Steelman Telecom's valuation metrics are starkly unfavorable. For instance, Bharti Airtel Ltd. has a PE ratio of 40.24 and an EV to EBITDA of 13.55, positioning it as expensive but still significantly better than Steelman. Similarly, Tata Communications Ltd. is rated attractive with a PE of 44.86 and an EV to EBITDA of 13.07. Despite a recent one-year stock return of 22.86%, which outperformed the Sensex's 7.55%, the underlying financial metrics suggest that Steelman Telecom is not a sound investment at its current price of 156.40.